Latest news with #Deerfield-based
Yahoo
24-06-2025
- Business
- Yahoo
Editorial: A sale of Northern Trust would be a major blow to Chicago
Founded in 1889, Northern Trust is one of Chicago's most storied companies. Its colorful back story includes building a makeshift branch that handled the banking needs of vendors and attendees at the Columbian Exposition after the bank hired to do the job failed a week after the 1893 World's Fair opened. How many ordinary Chicagoans know that? Precious few, surely. Northern Trust is low profile by design. Chicago's largest locally headquartered bank, Northern Trust caters to wealthy households and families across the country, and thus is discrete about its business and clients as one might expect. Northern Trust also is one of Chicago's relatively few truly global companies, positioned as one of the world's handful of financial institutions that hold trillions of dollars in assets on behalf of large institutional investors and process their transactions. This quiet giant employs thousands in Chicago and has been a dedicated civic donor for generations. We provide this thumbnail description because a company that likes to be under the radar suddenly is in an unwelcome spotlight. The Wall Street Journal reported Sunday that Northern Trust CEO Michael O'Grady met last week with his counterpart at Bank of New York Mellon about a potential combination of the two entities. The news comes less than four months after the Deerfield-based parent of Walgreens agreed to be purchased by New York private-equity firm Sycamore Partners. Like Northern Trust, Walgreens has a Chicago history that goes back well over 100 years. The notion that Walgreens, a Chicago mainstay, could be swallowed by a New York investment firm with a name few in these parts recognized, would have seemed ludicrous even a few short years ago. But in these times of economic volatility — first, a pandemic, then rampant inflation and now the uncertainty tied to trade policy in Washington, D.C. — there are few certainties in the business world. Even so, Northern Trust's status as a pillar of Chicago's business community seemed a pretty safe bet until the weekend bombshell. How safe is that bet now? There's reason to worry. BNY Mellon's market value is more than two times Northern Trust's, making it possible for the larger New York-based firm to offer a premium for the Chicago bank's shares. According to the report, the discussions are so early that there's been no talk of how much BNY Mellon might bid. Northern Trust was quick to dampen speculation, with a spokesman asserting the bank 'is fully committed to remaining independent and continuing to deliver long-term value to our stakeholders, as we have for 135 years.' The statement didn't stop investors from doing just that — speculating. They bid Northern Trust shares up by 8% Monday to their highest level in more than three years. For Chicago's sake, let's hope Northern Trust's statement truly reflects the sentiments of O'Grady and the board. A relentless series of sales of locally based banks to out-of-town buyers over the past two decades has dramatically weakened the city's once-powerful banking sector. New York's JPMorgan Chase in 2004 acquired Bank One, the city's largest bank at the time. Charlotte, N.C.-based Bank of America followed suit in 2007, swallowing LaSalle Bank, the city's second largest lender. Several smaller local banks bulked up in the wake of those splashy deals, snatching commercial clients who wanted more personalized service than the giants could or would provide. Most of them subsequently sold to out-of-town buyers such as Cincinnati-based Fifth Third, Canadian lender CIBC and even a bank based in Evansville, Indiana, called Old National. The most recent hit came just last month: Virginia-based Capital One completed its long-planned buyout of credit card lender Discover Financial Services, based in north suburban Riverwoods. We'll see what the future local job losses are from that deal, but surely they will be significant. Discover employs thousands in the Chicago area. Even without the negative effect of mergers, Chicago is losing well-paying, white-collar jobs provided by the likes of Discover and Northern Trust. Illinois has seen a steady decline in financial services employment since 2019, and most of those jobs are in the Chicago area. That trend means fewer residents making upper-middle-class salaries (or higher), which reduce overall consumer purchasing power and hold back the local economy. In short, our economy (and tax base) badly needs those sorts of workers. A buyout of Northern Trust also would damage Chicago's already tarnished image as a place to do business. We've seen powerhouse hedge fund and financial services company Citadel decamp for Florida. Manufacturing giant Caterpillar, with long ties to Illinois, hightailed it to Texas. Only a few decades after moving its base to Chicago, Boeing relocated its headquarters to the Virginia suburbs of Washington, D.C. Still, don't lose hope just yet. In addition to Northern Trust's stated desire to keep its independence, the good news for Chicago is that a tie-up with BNY Mellon would create substantial anti-trust concerns, even for an administration likely to be friendlier to such deal-making than the Biden administration. Northern Trust also has a particularly strong culture — Midwestern in sensibility, shunning the ostentation often associated with East Coast banking and investment firms — that would be difficult to absorb without risking the loss of key people in a high-touch business where relationships are critical. The axiom in the banking industry long has been that banks are sold, not bought. The sector is highly resistant to hostile takeovers, or even 'bear hugs,' where word of an acquirer's interest is leaked in hopes of stoking pressure from a target's shareholders to sell. Indeed, this leak features all the hallmarks of that latter approach. Still, any time Wall Street perceives a company such as Northern Trust as being 'in play,' all bets are off. A publicly traded company answers ultimately to its shareholders. Even if BNY Mellon's overture doesn't bear fruit in the short run, Northern Trust will have to perform well to remain a stand-alone for the long haul. Avoidable stumbles at Discover — running afoul of regulators in 2023 by failing to invest enough in compliance-related technology and personnel — opened the door for Capital One to make an offer Discover's board decided it couldn't refuse. Northern Trust can afford no such errors now that BNY Mellon's interest is publicly known. 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Chicago Tribune
23-06-2025
- Business
- Chicago Tribune
Editorial: A sale of Northern Trust would be a major blow to Chicago
Founded in 1889, Northern Trust is one of Chicago's most storied companies. Its colorful back story includes building a makeshift branch that handled the banking needs of vendors and attendees at the Columbian Exposition after the bank hired to do the job failed a week after the 1893 World's Fair opened. How many ordinary Chicagoans know that? Precious few, surely. Northern Trust is low profile by design. Chicago's largest locally headquartered bank, Northern Trust caters to wealthy households and families across the country, and thus is discrete about its business and clients as one might expect. Northern Trust also is one of Chicago's relatively few truly global companies, positioned as one of the world's handful of financial institutions that hold trillions of dollars in assets on behalf of large institutional investors and process their transactions. This quiet giant employs thousands in Chicago and has been a dedicated civic donor for generations. We provide this thumbnail description because a company that likes to be under the radar suddenly is in an unwelcome spotlight. The Wall Street Journal reported Sunday that Northern Trust CEO Michael O'Grady met last week with his counterpart at Bank of New York Mellon about a potential combination of the two entities. The news comes less than four months after the Deerfield-based parent of Walgreens agreed to be purchased by a New York private-equity firm Sycamore Partners. Like Northern Trust, Walgreens has a Chicago history that goes back well over 100 years. The notion that Walgreens, a Chicago mainstay, could be swallowed by a New York investment firm with a name few in these parts recognized, would have seemed ludicrous even a few short years ago. But in these times of economic volatility — first, a pandemic, then rampant inflation and now the uncertainty tied to trade policy in Washington, D.C. — there are few certainties in the business world. Even so, Northern Trust's status as a pillar of Chicago's business community seemed a pretty safe bet until the weekend bombshell. How safe is that bet now? There's reason to worry. BNY Mellon's market value is more than two times Northern Trust's, making it possible for the larger New York-based firm to offer a premium for the Chicago bank's shares. According to the report, the discussions are so early that there's been no talk of how much BNY Mellon might bid. Northern Trust was quick to dampen speculation, with a spokesman asserting the bank 'is fully committed to remaining independent and continuing to deliver long-term value to our stakeholders, as we have for 135 years.' The statement didn't stop investors from doing just that — speculating. They bid Northern Trust shares up by 8% Monday to their highest level in more than three years. For Chicago's sake, let's hope Northern Trust's statement truly reflects the sentiments of O'Grady and the board. A relentless series of sales of locally-based banks to out-of-town buyers over the past two decades has dramatically weakened the city's once-powerful banking sector. New York's JPMorgan Chase in 2004 acquired Bank One, the city's largest bank at the time. Charlotte, N.C.-based Bank of America followed suit in 2007, swallowing LaSalle Bank, the city's second largest lender. Several smaller local banks bulked up in the wake of those splashy deals, snatching commercial clients who wanted more personalized service than the giants could or would provide. Most of them subsequently sold to out-of-town buyers such as Cincinnati-based Fifth Third, Canadian lender CIBC and even a bank based in Evansville, Indiana, called Old National. The most recent hit came just last month: Virginia-based Capital One completed its long-planned buyout of credit card lender Discover Financial Services, based in north suburban Riverwoods. We'll see what the future local job losses are from that deal, but surely they will be significant. Discover employs thousands in the Chicago area. Even without the negative effect of mergers, Chicago is losing good-paying, white-collar jobs provided by the likes of Discover and Northern Trust. Illinois has seen a steady decline in financial services employment since 2019, and most of those jobs are in the Chicago area. That trend means fewer residents making upper-middle-class salaries (or higher), which reduce overall consumer purchasing power and hold back the local economy. In short, our economy (and tax base) badly needs those sorts of workers. A buyout of Northern Trust also would damage Chicago's already tarnished image as a place to do business. We've seen powerhouse hedge fund and financial services company Citadel decamp for Florida. Manufacturing giant Caterpillar, with long ties to Illinois, hightailed it to Texas. Only a few decades after moving its base to Chicago, Boeing relocated its headquarters to the Virginia suburbs of Washington, D.C. Still, don't lose hope just yet. In addition to Northern Trust's stated desire to keep its independence, the good news for Chicago is that a tie-up with BNY Mellon would create substantial anti-trust concerns, even for an administration likely to be friendlier to such deal-making than the Biden administration. Northern Trust also has a particularly strong culture — Midwestern in sensibility, shunning the ostentation often associated with East Coast banking and investment firms — that would be difficult to absorb without risking the loss of key people in a high-touch business where relationships are critical. The axiom in the banking industry long has been that banks are sold, not bought. The sector is highly resistant to hostile takeovers, or even 'bear hugs,' where word of an acquirer's interest is leaked in hopes of stoking pressure from a target's shareholders to sell. Indeed, this leak features all the hallmarks of that latter approach. Still, any time Wall Street perceives a company such as Northern Trust as being 'in play,' all bets are off. A publicly traded company answers ultimately to its shareholders. Even if BNY Mellon's overture doesn't bear fruit in the short run, Northern Trust will have to perform well to remain a stand-alone for the long haul. Avoidable stumbles at Discover — running afoul of regulators in 2023 by failing to invest enough in compliance-related technology and personnel — opened the door for Capital One to make an offer Discover's board decided it couldn't refuse. Northern Trust can afford no such errors now that BNY Mellon's interest is publicly known.
Chicago Tribune
02-05-2025
- Business
- Chicago Tribune
Regional superintendent, Fortune Brands honored at Lake County Partners' Big Event
Michael Karner's job as the Lake County Regional Superintendent of Schools focuses, in large part, on educating the children who can sometimes be a challenge for the county's 47 public school districts. Between operating the Regional Safe School for students who need placement outside their home district, offering classrooms for a student who may be suspended for a few days and creating a statewide virtual school, Karner continues to find innovative ways to educate. 'We established the Safe School for grades six through 12 for students when they needed an alternative placement,' he said. 'We give them what they need when their home district can't.' Getting the attention of the business community, Karner started Career Navig8 Lake County for middle and high school students to expose them to potential careers at a young age so they can incorporate it into their education. Karner received the Lake County Partners Talent Advancement Award on Thursday at the organization's annual Big Event in Lincolnshire in front of more than 500 people for his shaping of career pathways, among other achievements. 'Dr. Karner is a superstar in the education space, and the complete list of his accomplishments would blow you away,' said Steve Madden, the chair of the Lake County Partners Board of Governors. 'He has ushered in transformative thoughts, concepts and programs at the cutting-edge of education.' Along with Karner, Deerfield-based Fortune Brands — operator of more than 15 lines, including Moen, Master Lock and Sentry Safe — received the Community Investment Award as it makes a major investment in its corporate headquarters. Madden and Lake County Partners President and CEO Kevin Considine talked about the growth of business in the county over the past year, and future expectations. The crowd also learned about the makings of good locations for business from real estate economist Joshua Harris. Last year, Madden said businesses made $1.43 billion in capital investments, added 4,000 new jobs and, in part through Lake County Partners' efforts, kept 2,500 existing jobs from relocating across the state line to Wisconsin or other locations. Joining with Chicago and six other suburban counties including Cook, Madden said Lake County Partners formed the Greater Chicagoland Economic Partnership. Members including Considine and Lake County Board Chair Sandy Hart, traveled abroad selling the area to companies. 'We're not just individual organizations, cities or counties,' he said. 'Together, we're a powerhouse with unmatched competitive advantages and a high quality of life, and we want site selectors, business leaders, investors and talent to know it.' Appointed school superintendent in 2021 by Hart upon the retirement of Roycealee Wood, Karner was elected to the position in 2022. He has worked with state and federal officials to obtain $18 million in grants to fund many of the programs. After inaugurating the Safe School, Karner said he started the Illinois Virtual School in 2022, offering online learning to 10,000 students statewide, from kindergarten through high school seniors. Each time a student passes a course, their home district is reimbursed for the expense. The Navig8 Lake County career fair in October drew 4,200 middle and high school students to learn what 100 employers do. Karner said he also started a care navigation service to help find mental and physical health care. 'It gives one-on-one service to help people find health care appointments,' he said. 'It has changed a four-month wait to four days in Lake County. It is primarily for mental health needs.' Fortune Brands is making a major expansion of its Deerfield headquarters. Leigh Avsec, the company's executive vice president for external affairs, said for the first time the corporate staff of all of the company's brands will be housed in one place. Some of Fortune Brands' businesses are well known to consumers, like Master Lock. Avsec said the others are very well known in their industry. She talked about how their safes preserved valuables when people had to flee a disaster. 'People had three minutes to flee,' Avsec said. 'When they returned (almost) everything was lost. When they opened the safe, all their valuables were there — their papers, their jewelry. It was all there.'
Chicago Tribune
01-05-2025
- Business
- Chicago Tribune
Baxter International expects tariff impact of $60 to $70 million this year
Tariffs will likely cost Deerfield-based Baxter International $60 to $70 million this year, the company's chief financial officer said in an earnings call Thursday. Baxter expects to see most of the impact from increased tariffs in the second half of the year, said Joel Grade, Baxter executive vice president and chief financial officer. Baxter makes IV fluids, a number of pharmaceuticals and other hospital products. 'We are able to mitigate a portion of these impacts,' Grade said. ' … Currently a majority of Baxter's products sold in the U.S. are manufactured in the U.S. and made largely from U.S.-made components. However, international procurement is part of our business operations and as such we are impacted from the U.S. and retaliatory tariffs that have been issued.' Though only a small percentage of Baxter's total sales are in China, 'given the magnitude of the tariffs that have been enacted between the two countries, these tariffs now account for nearly half of the total impact,' he said. President Donald Trump has proposed sweeping tariff increases on a number of countries in an effort to boost jobs and manufacturing the U.S. Last month, Trump suspended most of those tariffs – except for China – for 90 days. The Trump administration has not yet increased tariffs on pharmaceuticals, but is now investigating how imports of pharmaceuticals and pharmaceutical ingredients affects national security. Baxter's assumptions do not include any potential changes to tariffs on pharmaceutical products, Grade said. Baxter is considering a number of strategies to mitigate the impact of tariffs, including carrying additional inventory, identifying alternative suppliers, alternative shipping routes and 'targeted pricing actions,' Grade said. Baxter is also working with its trade association partners to advocate for possible exemptions, he said. 'Some of these actions will be able to realized more near-term to help mitigate the impact in 2025, and others will require more time to be implemented but will help offset the impact in future years,' Grade said. Grade's comments about tariffs came during otherwise positive quarterly results Baxter, which saw its net income increase $126 million in the first quarter of this year, compared with in increase of $39 million in the first quarter of last year. The quarterly results were Baxter's first since selling off its kidney care business to global investment firm Carlyle for $3.7 billion earlier this year. That business is now called Vantive and its headquarters is in the former Caterpillar building in Deerfield. In recent weeks, a number of companies have been quantifying the impacts of tariffs. The CEO of north suburban-based Abbott Laboratories said during an earnings call last month that he expected tariffs to cost the company 'a few hundred million dollars' in the second half of this fiscal year.
Yahoo
21-04-2025
- Business
- Yahoo
Walgreens to pay $300M to settle with Department of Justice over opioid allegations
Walgreens Boots Alliance has agreed to pay $300 million to settle allegations that it filled millions of invalid prescriptions for opioids and other controlled substances and illegally billed federal programs such as Medicare for those medications, the U.S. Department of Justice announced Monday. The federal government had alleged that Deerfield-based Walgreens filled prescriptions with 'egregious red flags,' according to an amended complaint filed last week in U.S. District Court for the Northern District of Illinois. The government alleged that Walgreens filled prescriptions with high dosages of opioids, filled prescriptions for the drugs too early, and filled prescriptions for a dangerous combination of three drugs, from late 2013 to early 2023, according to the complaint. The government had alleged that Walgreens pressured its pharmacists to fill the prescriptions quickly, without giving them time to check if the prescriptions were valid. The government also alleged that Walgreens submitted the invalid prescriptions to federal health insurance programs, including Medicare for reimbursement, in violation of the federal False Claims Act. 'Walgreens knowingly filled numerous invalid controlled-substances prescriptions that were either not issued in the usual course of professional practice, not for a legitimate medical purpose, or both,' the government had alleged, according to the settlement agreement. 'Walgreens knew that such prescriptions raised significant concerns and were highly likely to be invalid. But Walgreens nevertheless filled numerous such prescriptions without resolving the significant concerns those prescriptions raised.' Walgreens has denied the allegations. The settlement agreement does not include any admission of wrongdoing or liability by Walgreens. 'The Company entered into the Settlement Agreement to resolve the last anticipated major opioid regulatory matter and to avoid the cost and uncertainty of continued litigation,' Walgreens said in a filing with the Securities and Exchange Commission on Friday. U.S. Attorney General Pamela Bondi said in a news release, 'Pharmacies have a legal responsibility to prescribe controlled substances in a safe and professional manner, not dispense dangerous drugs just for profit.' As part of the settlement, Walgreens will also have to pay interest on the money, and it will have to pay an additional $50 million if the company is sold or merges with another company before fiscal year 2032. Walgreens announced last month that it had agreed to be sold to a private equity firm in a deal expected to close in the fourth quarter of the year. That sale announcement followed years of financial struggles for the retail pharmacy giant, which has been grappling with changing consumer habits, challenges related to medication reimbursement and a ill fated foray into primary care. As part of the settlement agreement, Walgreens must also maintain policies and procedures requiring pharmacists to make sure controlled substances are valid before filling prescriptions for them, among other requirements. The allegations against Walgreens were originally brought by whistleblowers who were former Walgreens employees, with the first of the whistleblowers filing a lawsuit in 2018. The U.S. Department of Justice intervened in the consolidated cases in August. The federal False Claims Act allows whistleblowers to sue on behalf of the U.S. government and receive a share of any money recovered. The four whistleblowers will receive 17.25% of the settlement money, according to the Department of Justice. The settlement announcement comes less than two months after Walgreens said it had agreed to pay a separate, $595 million settlement to a virtual care company over a dispute involving COVID-19 testing.
