Milling & Baking News - October 19, 2004 - (Page 1)

Theinewsweeklyiofigrain-basedifoods Equity groups grab stakes in I.B.C.; shareholder committee formed KANSAS CITY - Shareholder issues took center stage last week at Interstate Bakeries Corp. as three additional equity groups revealed ownership stakes in the company while a group of shareholders formed an ad hoc committee to represent their interests. New York-based EagleRock Capital Management, L.L.C.; New York-based Gruss Asset Management L.P.; and San Francisco-based Barclays Global Investors N.A. all reported purchasing stakes in I.B.C. in filings with the Securities and Exchange Commission. EagleRock said its stake equaled 6.2% of the company's outstanding stock, or 2.82 million shares. Gruss said its stake totaled 5.7% of I.B.C.'s outstanding shares, or 2.6 million shares. Barclays said it and its subsidiaries now own 0.7% of the company, or 326,500 shares. In late September, QVT Financial L.P., a hedge fund based in the Cayman Islands, said it had purchased a 7.3% stake in I.B.C., equaling 3.3 million shares, in the six days after the nation's largest wholesale baker filed for Chapter 11 bankruptcy Sept. 22. Combined, those four entities now own a fifth of Interstate, whose shares last week Continued on Page 11 U.S.D.A. lowers wheat carryover forecast to 569 million bus WASHINGTON - The Economic Research Service of the U.S. Department of Agriculture on Oct. 12 lowered its projection of the wheat carryover on June 1, 2005, by 9 million bus, to 569 million bus. The previous forecast, at 578 million bus, had been issued in September. The projected carryover was up 22 million bus, or 4%, from June 1, 2004, stocks of 547 million bus and was at the low end of the range of pre-report trade estimates. Accounting for the reduction in the 2005 carryover projection from the month before were a 25-million-bu increase in projected feed and residual use of wheat and a 25million-bu increase in the export projection. These more than offset the effect of a 41-million-bu increase in estimated production. The E.R.S. pegged 2004-05 beginning Continued on Page 18 New options, new targets Story on Page 21 inside OCTOBER 19, 2004 / LATE NEWS SEATTLE - Starbucks Corp. now sells lunch sandwiches and salads in more than 2,000 stores across 10 markets, and the Seattle-based chain expects to increase that number to more than 2,500 stores across 15 markets by the end of fiscal 2005, said Michelle Gass, senior vice-president, global category management, during an analysts conference Oct. 14. The lunch program contributes annual sales of about $30,000 per store. Starbucks also announced it is offering a line of premium desserts and that during fiscal year 2004 more Continued on Page 10 Sandwiches pad sales at Starbucks Cargill's first-quarter earnings surge 43%; vote set for Oct. 20 MINNEAPOLIS - Cargill, Inc., overcoming price volatility in raw material and export markets, reaped a 43% profit increase during its fiscal first quarter ended Aug. 31, the company said. Riding solid results in its primary food processing businesses, its risk management businesses and its steel operations, Cargill earned $495 million in the quarter, compared with $347 million in the same period last year. Profit from continuing operations reached $457 million, up 33% from $348 million last year. Warren Staley, Cargill's chief executive, called the quarter's results "outstanding," noting that the company's fertilizer business Continued on Page 16 THIS WEEK Burger King franchisee may go private 13 Ingredient 2004 corn crop estimate jumps Veneman launches school effort 17 Week 35 38

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Milling & Baking News - October 19, 2004