Milling & Baking News - December 5, 2006 - (Page 1)

Theinewsweeklyiofigrain-basedifoods Commission issues scathing report on A.W.B.-Iraq wheat deals CANBERRA, AUSTRALIA - Judge Terence Cole, head of an independent commission authorized by the Australian government of Prime Minister John Howard to investigate alleged wrongful dealings between the Australian Wheat Board and the Iraq government under Saddam Hussein, issued his report Nov. 27. The report was a scathing indictment of the former management of the A.W.B., which the commission found knowingly paid kickbacks to the Saddam Hussein government to secure wheat sales to Iraq under the United Nations Oil-for-Food Program, and then purposely deceived both the U.N. and the Aus- tralian government when concerns about the transactions were raised. Commissioner Cole recommended the police investigate 11 former executives of the A.W.B., including its former chairman, Trevor Flugge, and an executive of an Australian mining company complicit in the affair, saying they likely broke Australian corporate and criminal laws. The commission explained that because of hardships inflicted on the people of Iraq by U.N. sanctions imposed on that country after the Gulf War in 1990, the U.N. Security Council established the Oil-for-Food Continued on Page 16 N E W S F E AT U R E Charter Baking methodically moves to organic baking leadership goal C onsolidating recent acquisitions and contemplating its next steps, Charter Baking Co. continues to work toward an ambitious goal - to establish itself as the clear leader in the organic baking category with a national footprint. The business structure at Charter Baking could be viewed as an unusual mix. While the organic food market still clings to a homespun, mom and pop shop image, Charter Baking is part of what is often viewed Foley as the intensely competitive part of the business world - private equity. The company was established in February 2005 by Charterhouse Group, a private equity firm with $1.3 billion under management. Still, with the organic food market chalking up consistent double-digit sales growth year after year, the appeal to financial investors of establishing an organic baking company is easy to understand. Charterhouse laid out its strategic thinking not long after entering the baking business with the February 2005 acquisition of Vermont Bread Co. "We established Charter Baking Co. as a holding company in Continued on Page 29 inside DECEMBER 5, 2006 / LATE NEWS HEADLAND, ALA. - The Red Star Yeast plant in Headland is on schedule to be fully operational for the upcoming holiday season. The plant, which sustained damage to its roof and siding following a nearby tornado touchdown, is still under construction in some areas. Some electrical work also is being done. The company began a few shipments Nov. 29 and will continue to add the regular cream customers back on Headland throughout the next week. Shipments of Continued on Page 10 Red Star plant back in full swing Interstate Bakeries asks Delaware court to delay legal action KANSAS CITY - Warning that the company is at a crucial stage in its longstanding reorganization efforts, Interstate Bakeries Corp. has asked the Court of Chancery of the State of Delaware to delay proceedings in a legal action brought by Brencourt Advisors, L.L.C., one of its largest shareholders. In a filing with the Securities and Exchange Commission, Paul J. Lockwood, an attorney writing on behalf of I.B.C., asked the court to wait until after Dec. 19 to schedule a trial. I.B.C.'s response follows the Oct. 30 filing of a suit against the Kansas City-based maker of Twinkies and Wonder Bread by Brencourt, which owns an 8.4% share of I.B.C. stock. At that time, Brencourt asked Continued on Page 12 THIS WEEK Canada Bread closing plant in B.C. N.G.T.C. adopts new name and mission 15 18 Ingredient Additional leadership changes at Bunge 40 Week sponsored by 42

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Milling & Baking News - December 5, 2006