McKee is High Bidder for Drake's Snack Cakes
Hostess Brands Inc. today announced that the stalking horse bid submitted by McKee Foods for the Drake’s snack cake brand will be the bid presented for approval to the U.S. Bankruptcy Court as no other qualified bids were received for those assets.
“We know that Drake’s Cakes are unique baked goods that have a loyal following,” said Mike McKee, president and CEO. “McKee Foods is a family-owned bakery, similar to how Drake’s was established as a family bakery 125 years ago. We have generations of experience in baking, and we will strive to bake the Drake’s cakes, not just for taste and quality, but also to deliver on the memories of the loyal Drake’s fans.”
McKee Foods has agreed to pay $27.5 million for the Drake’s brand and certain equipment. Drake’s products include Ring Dings, Yodels, Devil Dogs, Yankee Doodles, Sunny Doodles and Drake’s Coffee Cake. Hostess will ask the U.S. Bankruptcy Court for the Southern District of New York to approve the transaction at a hearing on Tuesday, April 9. No part of the sale will be final until this approval is granted.
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Last Update on April 01, 2015 07:30 GMT
THE DAY AHEAD
WASHINGTON (AP) -- The Institute for Supply Management releases its manufacturing index for March later this morning. And the Commerce Department will issue construction spending figures for February.
In Detroit, automakers are set to release vehicle sales for March and in Toyko, the BOJ Tankan economic outlook comes out.
Monsanto Co. is scheduled to report its quarterly financial results before the market opens.
The government reported Tuesday that U.S. home prices rose at a steady pace in January, pushing prices up at a faster pace than wages and putting more homes financially out of reach for would-be buyers.
The Standard & Poor's/Case-Shiller 20-city home price index rose 4.6 percent in January compared with 12 months earlier. That's up from a growth rate of 4.4 percent in December.
OIL SPILL-ALABAMA CLAIMS
NEW ORLEANS (AP) -- A judge says Alabama's Gulf oil-spill-damage claims under the federal Oil Pollution Act can be heard by a jury.
BP had moved to block a jury trial for the state, saying that neither the Oil Pollution Act nor admiralty law provides the right to a trial by jury.
U.S. District Judge Carl Barbier in New Orleans rejected the oil giant's arguments in a ruling released late Monday. He noted cases in which other courts have held that juries can hear at least some claims under the pollution act, even though the act does not expressly provide for a jury. And he said the state is entitled to a jury under the Seventh Amendment.
Alabama Attorney General Luther Strange hailed the ruling in a news release. The civil cases arising from the 2010 spill have been consolidated in New Orleans. But Strange hopes that when the trial starts, as early as the spring of 2016, it will take place in Alabama.
DETROIT (AP) -- Still emerging from bankruptcy, the city of Detroit got a boost when an automotive financial services company based there announced that it will remain downtown rather than move to the suburbs.
Ally Financial Inc. signed a 12-year lease to move its headquarters and 700 employees a few blocks from the Renaissance Center to the One Detroit Center.
The company also said it will consolidate its southeastern Michigan operations and move 600 workers from other offices to downtown. Another 200 contractors and vendors also will work in the building which will be renamed Ally Detroit Center.
The move comes about three months after the city of Detroit restructured or erased $7 billion in debt through the largest municipal bankruptcy in U.S. history. But the city's downtown continued to improve and attract business even during Detroit's financial crisis.
Ally will occupy 13 floors and 321,000 square feet in the 43-story One Detroit Center.
BEIJING (AP) -- Two surveys show China's manufacturing activity was anemic in February and industry faced more downward pressure on prices, adding to signs of economic weakness.
HSBC Corp. said Wednesday that its monthly purchasing managers' index fell to 49.6 on a 100-point scale on which numbers below 50 show activity contracting. A separate index by an industry group, the Chinese Federation of Logistics and Purchasing, and the National Bureau of Statistics edged up 0.2 points from February to 50.1.
Both surveys showed prices of industrial goods declined in February, a sign of weak demand.
Beijing has cut interest rates twice since November to spur economic growth that declined to 7.3 percent in the final quarter of last year, fueling fears of a politically dangerous spike in job losses.
TOKYO (AP) -- A survey by the Japanese central bank finds Japanese businesses remain wary over the outlook for the world's No. 3 economy and generally plan to reduce capital investment.
The Bank of Japan's quarterly "tankan" survey will likely reinforce the conviction among many that more stimulus is needed to sustain growth.
The leading measure of business sentiment showed more than two-thirds of all companies anticipate further deterioration in conditions, with 83 percent of large manufacturers branding conditions "not so favorable" or "unfavorable."
Japanese businesses anticipate weak demand both at home and overseas for their products and higher costs for materials thanks to the weakening Japanese yen.
The economy emerged from a half-year recession last year following a sales tax hike that dented consumer and corporate demand. But growth has remained weak.
ARCTIC OFFSHORE LEASING
ANCHORAGE, Alaska (AP) -- The Department of Interior says it has affirmed a corrected environmental analysis for a 7-year-old petroleum lease in the Chukchi (chuk-CHEE') Sea off Alaska's northwest coast.
The agency's expected decision Tuesday confirms that it corrected flaws surrounding the 2008 lease sale. That opens the door for the department to review a 2015 petroleum exploration plan by Royal Dutch Shell PLC in Chukchi waters.
The sale was challenged in a lawsuit by conservation and Alaska Native groups.
Federal courts twice ordered the environmental analysis to be revised. The groups said the former Minerals Management Service had based its environmental review on projected extraction of only 1 billion barrels of oil.
The supplemental review assumes an extraction of 4.3 billion barrels and greater potential impacts.
WASHINGTON (AP) -- The head of the IRS says his agency has eliminated a huge processing backlog of groups seeking tax-exempt status.
Claims by tea party organizations that they were singled out for tough treatment when they applied for that designation were at the heart of a 2013 controversy over the agency.
IRS Commissioner John Koskinen said in remarks prepared for the National Press Club that there once was a backlog of over 60,000 applications for tax-exempt status.
Koskinen says his agency has developed faster processes including a shorter application form. He said that as a result, the IRS inventory of applications is now current.
A conservative legal center leading a federal lawsuit against the IRS says one group it represents is still waiting for an IRS ruling after five years.
US Steel to idle part of Minntac; 680 layoffs expected
MINNEAPOLIS (AP) -- U.S. Steel Corp. says it plans to shut down part of its Minntac plant at Minnesota's biggest iron mine, resulting in about 680 layoffs.
It's the latest symptom of a downturn in the American steel industry that has taken a heavy toll on the Iron Range of northeastern Minnesota. U.S. Steel cited high steel imports, dumping of foreign steel and low steel prices in its announcement Tuesday.
U.S. Steel spokeswoman Courtney Boone says the layoffs are temporary at the Mountain Iron facility, which employs about 1,500 workers. But she also says the company can't speculate how long they'll last. She says that will depend on market conditions and customer demand. Boone said that three of the plant's five iron ore processing lines will be shut down.
About three weeks ago, Pittsburgh-based U.S. Steel said it would idle its Keetac plant in nearby Keewatin effective May 13, resulting in 412 workers laid off. And Magnetation LLC announced in February that it was shutting down its Keewatin plant, resulting in about 20 job losses. The mining region is about 200 miles north of Minneapolis.
ASSET FORFEITURE PROGRAM
WASHINGTON (AP) -- Attorney General Eric Holder is announcing policy changes to the federal government's asset forfeiture program as part of an ongoing review.
The policy change would limit the government's ability to seize bank deposits to cases involving the most illegal banking transactions.
At issue are cases involving so-called structuring, a practice in which someone evades bank reporting requirements by making a series of deposits below a certain threshold.
Under the new policy, Justice Department officials would not seize structured funds unless there was evidence that they were designed to hide other criminal activity, or if there's a compelling law enforcement interest.
Prosecutors would also be expected under the new policy to file charges within 150 days against the seized funds, or else return them.
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