University of Pennsylvania trustees decided earlier this year that Penn's debt load and U.S. interest rates had fallen far enough to make it worthwhile to borrow $300 million through taxable 100-year bonds - and sell them to eager investors at a cheap interest rate just below 4.7 percent, a bit less than MIT and Caltech had to pay on similar recent "century bonds."
What's the attraction? You stretch the payments out, and you don't have to worry about refinancing until everyone who approved the deal is dead.
Penn is pumping most of it into energy-
Penn hired Torcon Inc. of Red Bank, N.J., to recommend improvements. Project executive John DeFazio, based at Torcon's local Navy Yard branch, is overseeing a review of what he calls a vast array of more than 40 buildings. Penn includes the Victorian-era Furness Library and the crumbly Chester County serpentine-stone College Hall, the blocky classroom stacks of the postwar social science departments, complex medical, science, and engineering labs, and the blank soaring atriums at Wharton, all linked by steam loops and layered electric, heating, ventilation, and air-conditioning service.
Torcon has already overseen upgrades at Arch Hall (the old Christian Association). All over, DeFazio's team will be tagging fat 20th century-style fluorescent fixtures with new inch-diameter bulbs and electronic ballasts, plus outdoor LED lighting (though LED is still too expensive to go everywhere. In the chem labs, 1970s-era constant air circulation will be replaced with variable air-volume systems that can be turned off automatically and remotely, in sections.
"One of the great things about the construction business" is how much you can learn from clients - like Penn professors and other veteran staff who are highly protective of fancy woodwork and plaster and other details that Torcon has learned to work around, says DeFazio, a 30-year industry veteran who's also done jobs for Campbell Soup Co. and Villanova, among other institutions, since joining the firm in 2005. The firm is owned by the sons of founder Ben Torcivia Sr., who died earlier this fall.
DeFazio's in awe of the Penn community: "Walk down Locust Walk for 1,000 feet, you can hear five or six languages. And that's not counting what they have at Penn Medicine."
Brazilian slaughterhouse and freezer giant Marfrig Alimentos SA paid $1.26 billion for Herb Lotman's food supply giant, Keystone Foods, inventor of McDonald's Chicken McNuggets, in 2010.
It's now a smaller place. Chief executive Jerry Dean retired early, in May 2011. Marfrig brought in Campbell Soup veteran Larry McWilliams as Dean's heir apparent; he stayed less than a year, during which Marfrig sold off Keystone's trucking and warehouse arm, surprising Keystone veterans.
McWilliams' departure was followed by that of HR chief Leslie Billow, controller Bill Hennessey, and others, who haven't been replaced. Marfrig did bring back ex-Keystone VP Bill Andersen, whom McWilliams had removed, as chief operating officer. CFO John Coggins has remained on board and is acting as CEO for now.
Ex-Cargill CFO Sergio Rial was named last month to head Marfrig's Seara division, which includes Keystone. The company ran deep into debt over Keystone and other acquisitions; share values fell; it's currently trying to raise more money on the Brazilian stock market.
What's the plan for Keystone's Conshohocken headquarters and the West Chester lab? Keystone is "aligning resources and streamlining processes," and "our business continues to improve," the company said in a statement when I asked about its plans.