Milling & Baking News - July 23, 2013 - (Page 1)

THE NEWS WEEKLY OF GRAIN-BASED FOODS JULY 23 , 2013 / Cracker Update Richard Seban sees Hostess cakes competing toe-to-toe with candy Cashing in on crackers Mondelez, Pepperidge among companies capitalizing on consumers’ cravings Story on Page 26 LATE NEWS Investor puts pressure on PepsiCo to split up NEW YORK — Stating that PepsiCo, Inc. is at a “strategic crossroads” and that the “status quo is unsustainable,” the investment firm Trian Fund Management L.P., which owns 1.3 billion shares of PepsiCo stock, has published a white paper that outlines two strategic alternatives PepsiCo’s management may adopt in an effort to improve shareholder value. The options include breaking up the company to create separate pure play beverage and snack food companies or merging with Mondelez International to create a global snack food company and spinning off the beverage business. By merging PepsiCo Continued on Page 8 KANSAS CITY — A move to warehouse distribution and away from direct-store delivery will allow Hostess Brands, L.L.C. to compete toe-to-toe in the market for snack treats, said Richard C. Seban, president. In an interview with Milling & Baking News, Mr. Seban said Hostess is primed to win back its spot on familiar — and new — shelves this summer. The new distribution approach was one of several significant changes Mr. Seban said will help restore luster to a brand and business diminished by struggles dating back many years. Retail sales of Hostess products resumed July 15 following a hiatus dating back nearly eight months. As part of its acquisition of the Hostess snack cakes business, private equity firm Metropoulos & Co. and Apollo Global Management L.L.C. netted five plants, and Hostess has poured $30 million into four of these over the past few months. The plants are located at Columbus, Ga.; Schiller Park, Ill.; Indianapolis; and Emporia, Kas. A fifth plant in Los Angeles has not been reopened. “The (four) plants structurally were among the better plants Hostess operated before for cakes, so the plants were Continued on Page 11 Chelsea Milling in major move into institutional, food service markets CHELSEA, MICH. — Several years after launching a trial in which Chelsea Milling Co. explored a move beyond its deep retail roots, the company has embarked on a $35 million capital project, the largest expansion in its 83-year history. In an interview with Milling & Baking News, Howard S. (Howdy) Holmes, president and chief executive officer, said the project will include the installation of several bulk ingredient silos, the construction of small buildings, the upgrade of its flour transfer systems and the addition of a new mixing department. The project is aimed at giving Chelsea access to the food service and institutional markets. At one level, Mr. Holmes said the project at Chelsea Milling should be viewed in the context of what he called “a long line of upgrades.” The Holmes family’s roots in milling date back to the 1800s, but it was in 1930 when Mr. Holmes’ grandmother developed and launched the first prepared Jiffy mix product that has been a singular focus of Chelsea for decades. The Jiffy line includes brownie mix, cake mixes, corn muffin mix, pie crust mix, frosting mixes, multi-purpose Continued on Page 18

Table of Contents for the Digital Edition of Milling & Baking News - July 23, 2013

Milling & Baking News - July 23, 2013
Richard Seban sees Hostess cakes competing toe-to-toe with candy
Chelsea Milling in major move into institutional, food service markets
Late News - Investor puts pressure on PepsiCo to split up
Table of Contents
News/Comment - I.F.T. gains give signals, positive and less so
Editorial - Book about wheat still a best-seller
Late News
Washington - House-Senate farm bill conference in holding pattern
A.B.A. disappointed in ‘farm-only’ bill passage
Business - Denver area selected as location for Ardent Mills headquarters
Dan Dye offers insights into factors attracting Ardent Mills to Denver
Flowers confirms go-ahead on purchase of Hostess bread, assets
Hodgson Mill adds quinoa and brown rice side dishes
C.P.I. for baked foods, cereals moves up 0.3% in June
White bread price moves up, whole wheat eases
Financial Results - Pressed by slumping Ag segment, CHS profits down in third quarter
Krispy Kreme to repurchase $50 million in common stock
Food Ingredient Solutions - Natural sweetener options not so simple
Sweetener solutions at I.F.T.
Outcomes differ in aided and unaided surveys
Cracker Update - Cashing in on crackers
Farm versus fork
Nutrition and Health - Obesity, health issues prompt more food labeling
People - Tim Skidmore to CHS Inc. from Campbell Soup as new c.f.o.
William Lucks, chairman of The Lucks Co., dies
Einstein Noah promotes Hilario to chief operations officer
Erica Olson elected chairman at Wheat Foods Council
AB Mauri hires development manager for tortillas
Supplier Innovations
Ingredient Market Trends - China again a big player in world soft red winter wheat trade
Ingredient Week
Marketplace Business Network
Ad Index

Milling & Baking News - July 23, 2013