Business News - part 42

Judge Hears Hostess Bankruptcy Case

Judge Hears Hostess Bankruptcy Case

BUSINESS

  • Manufacturer, union agree to mediation
  • Hostess seeking permission to pay management bonuses
  • Potential bidders may be interested in Hostess brands

Hostess Brands Inc, the manufacturer of Wonder bread and Twinkies snack cakes, agrees to mediation at the urging of US Bankruptcy Judge Robert Drain who hopes to prevent the loss of nearly 18,500 jobs.

Hostess blames the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union strike, which began in early November, for the company’s bankruptcy. The union blames management.

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Hot Drinks Industry: Starbucks To Better Compete In Tea Market With Teavana Acquisition

Hot Drinks Industry: Starbucks To Better Compete In Tea Market With Teavana Acquisition

BUSINESS

  • Teavana largest acquisition in aggressive Starbucks expansion plan
  • Starbucks to capitalize on increasing popularity of tea
  • Consumers in India drinking 7 times more tea than coffee; consumers in China drinking 16 times more

Coffee chain leader Starbucks will acquire Teavana Holdings Inc., a premium loose-leaf tea company, for around $620 million as part of its expansion plan. With Teavana the largest of its acquisitions to date, Starbucks is moving to maintain revenue in the face of rising competition from fast-food chains that now sell specialty coffees.

The takeover should be complete by the end of 2012, allowing Starbucks immediate access to Teavana’s 300 storefronts, consumer base and popular product line.

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US Telecom Update: AT&T, Verizon Expand 4G LTE Networks

US Telecom Update: AT&T, Verizon Expand 4G LTE Networks

BUSINESS

  • AT&T rolls out ultra-fast network in eight US cities
  • Verizon to offer 4G coverage across all US wireless networks by next year
  • Sprint Nextel to add nine more cities to network in coming months
  • Global 4G subscriptions to soar to over 560 million by 2016

Top wireless network providers in the United States are expanding their 4G LTE networks, switching on their ultra-fast data connections in new cities across the country.

AT&T, the largest wireless operator in the US, has fired up its 4G network in eight more cities across the United States in key hubs such as Denver, Louisville, Milwaukee and Daytona Beach as well as in several smaller centers in Pennsylvania, Maryland, Washington and Utah.

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Walmart Facing Strong Competition From Target This Holiday Season

Walmart Facing Strong Competition From Target This Holiday Season

BUSINESS

  • Sales at US Walmart stores disappoint in third quarter
  • Target reports rise in sales 
  • Sam’s Clubs sees drop in sales, traffic

Walmart Stores Inc., the world’s largest retailer, saw disappointing third quarter sales for US Walmart stores and Sam’s Club locations as its customer base was hurt by unemployment and high gas prices.

Meanwhile, Target Corp., the second-largest US retail discounter, reported gains.

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Japanese Electronics Giant Panasonic Underperforming, Cutting 10K More Jobs

Japanese Electronics Giant Panasonic Underperforming, Cutting 10K More Jobs

BUSINESS

  • Nearly one fifth of Panasonic operating units losing money
  • Panasonic to spend $5.5 billion on restructuring costs
  • Panasonic could post losses of $10 billion by year end

As the Japanese consumer electronics industry continues to feel the effects of a troubled economy, Panasonic plans to cut 10,000 jobs by the end of March 2013.

According to Panasonic officials, most of the cuts will be at its overseas subsidiary Sanyo. This new announcement follows Panasonic's massive layoff of 36,000 workers in 2011.

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International Energy Agency Report: US To Become World’s Top Oil Producer

International Energy Agency Report: US To Become World’s Top Oil Producer

BUSINESS

  • Increased oil production to make US nearly self sufficient; may reduce electricity prices
  • US to lead natural gas production globally by 2015
  • Increased oil production to impact environment

The United States will overtake Saudi Arabia as the world’s leading oil producer by the end of the decade, says the International Energy Agency in its annual World Energy Outlook report, and it is also expected to become the world’s net oil exporter by 2030.

The production boost comes thanks to new technologies, like horizontal drilling and hydraulic fracturing.

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Scandinavian Airline SAS Seeks Savings, Cuts Salaries and 6,000 Jobs

Scandinavian Airline SAS Seeks Savings, Cuts Salaries and 6,000 Jobs

BUSINESS

  • Nearly 40% of SAS jobs to be cut to help secure credit
  • Reductions expected to save SAS $440 million per year
  • Analysts predict SAS will be bought by larger airline

Scandinavian airline SAS AB is forced to cut 6,000 positions as well as reduce salaries and pensions to qualify for credit lines through banks and Scandinavian governments.

The airline, which is owned by the governments of Norway, Sweden and Denmark as well as private investors, has not turned a full-year profit since 2007.

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Boston Scientific Buys Vessix Vascular To Accelerate Entry Into Renal Denervation Market

Boston Scientific Buys Vessix Vascular To Accelerate Entry Into Renal Denervation Market

BUSINESS

  • Boston Scientific to pay up to $425 milllion for Vessix Vascular
  • Boston Scientific latest company to buy into renal denervation hypertension treatment
  • Procedure available in Europe; yet to be approved in United States

Boston Scientific will buy Vessix Vascular, a privately owned manufacturer of radiotherapy-based systems that treat high blood pressure, in a deal reportedly worth up to $425 million.

As part of the agreement, Boston Scientific will pay $125 million upfront with up to $300 million extra as development and sales-based milestones are reached.

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Fast-Food Industry Update: McDonald’s Sales Slip For First Time Since 2003

Fast-Food Industry Update: McDonald’s Sales Slip For First Time Since 2003

BUSINESS

  • Nearly 33% of all McDonald’s revenue comes from US
  • US sales drop lower than analyst expectations; only UK saw gain in EU
  • Fast-food competitors Burger King and Wendy’s see sales rise

The world’s largest fast-food restaurant chain McDonald’s saw monthly sales fall for the first time in 9 years, with revenue down in most parts of the world.

Overall, in October revenue for stores open at least 13 months fell by 1.8% globally.

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Time Warner Cable Television Business Going Strong

Time Warner Cable Television Business Going Strong

BUSINESS

  • Time Warner reports a 12% increase in revenue since 2011
  • Quality programming and national sporting events making Time Warner more appealing to advertisers
  • Time Warner expects 9% increase in US advertising revenue in fourth quarter

Time Warner Inc. – the parent company for cable channels such as TNT, TBS and HBO – reported its strongest financial quarter ever, boasting a 12% revenue increase from 2011.

Time Warner’s recent success can be attributed to a variety of factors, including a 7% increase as compared to last quarter in what cable-TV providers pay.

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