Milling & Baking News - October 7, 2008 - (Page 1)

THE NEWS WEEKLY OF GRAIN-BASED FOODS OCTOBER 7, 2008 / FEATURE Unsecured creditors speak out against Interstate Bakeries plan Fuel prices, freight volume down on weak economy; rates rise as fall harvest builds Story on Page 20 LATE NEWS Study finds high sugar content in cereals YONKERS, N.Y. - A new nutrition ratings report from Consumer Reports on cereals marketed heavily to children found only 4 of the 27 cereals studied rated "very good," and 23 of 27 rated only "good" or "fair" for nutrition. The report appears in the November issue of Consumer Reports. The four cereals that ranked "very good" for nutrition were Cheerios, which topped the ratings with 3 grams of dietary fiber per serving and only 1 gram of sugar, Kix, Honey Nut Cheerios and Life. Post Golden Crisp and Kellogg's Honey Smacks, contained more than 50% sugar, while nine others had at least 40% sugar. "Be sure Continued on Page 8 KANSAS CITY - The proposed reorganization plan put forth earlier this month by Interstate Bakeries Corp. has come under fire from the company's unsecured creditors. The creditors, who are owed approximately $330 million, in a Sept. 29 filing with the U.S. Bankruptcy Court for the Western District of Missouri claimed the plan is too expensive and provides no payoff of what they are owed. In the filing, the unsecured creditors, which includes suppliers and noteholders who own debt that is not guaranteed by any collateral, said I.B.C. is "again seeking to unconditionally commit the estates to significant fees and reimbursement obligations in connection with a transaction whose prospects of being consummated remain speculative at best." "The proposed transaction lacks the support of the committee and other constituents and the debtors (I.B.C.) have offered no explanation for how unsecured creditors will benefit if the motion is approved," the unsecured creditors said. As part of the funding proposal put forth by I.B.C., the wholesale baker would be required to pay approximately $23 million in commitment fees, with approximately $3.25 million of the fees and all the reimbursement expenses immediately payable by I.B.C., without credit, refund or any court review. The unsecured creditors urged the court to deny the motion in part because it is subject to wide ranging contingencies, a scenario they said adversely affected I.B.C. in earlier talks. "(I.B.C.) should not be allowed to make the same mistake they did earlier this year by entering into the Silver Point commitment - paying large fees and getting nothing in return," the unsecured creditors said. Under terms of I.B.C.'s first reorganization plan announced last year, the Continued on Page 9 By many measures, John Miller sees milling industry improving INCLINE VILLAGE, NEV. - In 30-plus years since John C. Miller began his career in milling, he has witnessed extraordinary change. Like the industry, Mr. Miller's experiences in milling have been filled with sometimes traumatic ups and downs. But in a candid interview, Mr. Miller was more upbeat than ever about flour milling - the business, the executives managing the industry's companies and the North American Millers' Association. It was as the incoming chairman of the NAMA that Mr. Miller, president and chief executive officer of Miller Milling Co., spoke with Milling & Baking News in a Sept. 26 interview conducted during the group's annual meeting at the Hyatt Regency Lake Tahoe in Incline Village. An example of the change that has spanned Mr. Miller's career is The Pillsbury Co. - the company he joined just out of college. When he became a Grain Division accountant for Pillsbury Continued on Page 12

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Milling & Baking News - October 7, 2008