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Inquirer Daily News

Archive: July, 2013

POSTED: Thursday, July 25, 2013, 9:50 AM
(Photo from Amazon.com)

(See UPDATE with Campbell comments below) Campbell Soup, based in Camden, has made a "stark shift" toward "taste- and brand-driven innovation" and moved away from "the low-sodium and wellness messaging of the prior three years," writes analyst Jonathan Feeney in a report this morning to clients of Janney Capital Markets, Philadelphia. (A similar embrace of fatty new sandwiches is helping lift Wendy's at the expense of longtime U.S. burger champ McDonald's, whose new health-ier food isn't selling, Feeney's colleague Mark Kalinowski tells clients). 

"Listening carefully to the customer has driven a return to good-tasting, foolproof innovations like tastier, more filling Chunky varities --[for example] Philly Cheesesteak soup -- replacing 'All Natural' ready-to-serve soup with 'Home Style' Goldfish Mac & Cheese -- an intelligent extension into a kid-heavy adjacency - and even V8 Bloody Mary Mix, an obvious and foolproof line extension, if ever there was one," Feeney wrote.

He expects the shift to cheesy, fatty kid stuff, plus expanding popular old brands into new products, will boost sales and profits, despite the long-term drop in Campbell advertising spending. Still, Feeney's not sure Campbell's promising moves, by themselves, justify its one-third stock market rise year to date. Rather, he suspects investor excitement about a possible Campbell takeover after Heinz Food was sold earlier this year has juiced shareholder hopes the soup-maker will also be taken out at a fat sale premium. "But that is unlikely anytime soon," Feeney concludes.


POSTED: Thursday, July 25, 2013, 9:24 AM
(File Photo: Tom Gralish / Staff Photographer)

Updated with Len Amoroso's comments: The boss at West Philly-based Amoroso's bakery is part of a partnership that has purchased a 300,000 sq ft former Harcourt's book warehouse in Bellmawr, Camden County, the owner told me.

Mark Mathews at GloucesterCityNews.com notes the site could be a new location for Amoroso's, which, as I reported last year, has been looking at new plants to replace its aging West Philly bakery.

"We're considering it. We're still considering other options as well," including rival sites in Philadelphia and the suburbs, Amoroso's owner Len Amoroso told me.

POSTED: Thursday, July 25, 2013, 4:00 PM

Philadelphia had hoped to sell nearly $400 million in new and refinanced general-obligation bonds last month. But after Federal Reserve chairman Ben Bernanke threatened to stop his massive purchase of federal government debt, provoking investors to dump muni funds on fear of lower rates, the city rescheduled..

New municipal bond issues, which had been pricing at roughly the same near-record low rates as U.S. Treasuries, suddenly rose to as much as 0.6 percentage points -- a big gap, with today’s low rates -- according to data posted by Municipal Market Adviser.

So Philadelphia postponed its borrowing until this coming Friday, hoping rates would slip back down. That started to happen -- until Detroit surprised investors by declaring bankruptcy, driving bond yields almost as high as June’s peak. On Thursday, city finance chief Rob DuBow said at least part of the bond sale would be postponed again.

POSTED: Monday, July 22, 2013, 2:53 PM
Ellen Kullman is the first female CEO of Wilmington-based DuPont company and remains popular in her home town.

For a brief time in the 1950s, DuPont Co., the Wilmington-based global chemical products company, was the most valuable firm on the New York Stock Exchange. (For most of that period General Motors Corp. was the biggest, and also under du  Pont family control; but that's another story.)

But today DuPont, after years of asset sales and shifts into developing-country farm chemicals and energy products, and directed by popular hometown chief executive Ellen Kullman, survives as one of the least-valuable (by market cap) of the Dow-Jones 30 industrial stocks. Which means it's takeover bait. Or at least a candidate for chipping off assets and raising cash. Which is why shares last week jumped to a 12-year high of over $57 after CNBC reported that activist investor Nelson Peltz (Trian Fund Management) was buying up shares. Even though Peltz wouldn't confirm. 

"The most obvious question is if there is potential to unlock value from a break-up," wrote Citi Research analyust P.J. Juvekar in a report to clients. DuPont shares have been "essentially flat" since the late 1990s, while Monsanto, PPG and other chemical makers have gained value, he points out.

POSTED: Monday, July 22, 2013, 2:10 PM

1) Wayne Kimmel's SeventySix Capital, of Center City, has sold its stake in gesture-recognition electronics developer Omek Interactive, an Israeli firm that is building the Beckon "full-body tracking" system for use in wireless Video interface, at a price Industry sources have pegged the price at around $40 million. More at:

http://news.cnet.com/8301-1001_3-57593915-92/intel-buys-omek-interactive-for-$40m-report/
http://www.techspot.com/news/53252-intel-buys-israeli-gesture-recognition-firm-omek-interactive-for-40m.html
http://venturebeat.com/2013/03/29/intel-reportedly-in-talks-to-acquire-omek-interactive/
http://newsroom.intel.com/community/intel_newsroom/blog/2013/06/25/intel-labs-looks-inside-the-future
http://www.pcmag.com/article2/0,2817,2421849,00.asp
http://www.theverge.com/2013/7/16/4527622/intel-acquires-omek-interactive-gesture-recognition

2) Livewire Mobile Inc., based until now in Littleton, Mass., says it's moving its remaining operations to Radnor and is renaming itself Live Microsystems, after OnMobile Global Limited, of Cambridge in England, agreed to pay $17.8 milllion for Livewire's "end-to-end managed mobile entertainment solutions for network operators and consumer device manufacturers," including its British subsidiary,

POSTED: Monday, July 22, 2013, 1:34 PM
Wendy’s recently-launched Pretzel Bacon Cheeseburger may be the chain's best-selling new product introduction in at least a decade.

Shares of McDonald's slipped this morning after the global fast-food giant, which controls roughly half the U.S. hamburger chain market, reported lower than expected sales and profits, and projected a "relatively flat" summer, as Mark Kalinowski, fast food analyst at Janney Capital Markets in Philadelphia, told clients in a report this morning.

"We believe one reason for this is a resurgent Wendy’s," writes Kalinowski. "In the U.S.. Wendy’s recently-launched Pretzel Bacon Cheeseburger appears to be on track as the best-selling new product introduction by that burger concept in at least a decade. This pressure on McDonald’s could last over the third quarter as a whole, and perhaps beyond, if Wendy’s adds its Pretzel Bacon Cheeseburger as a permanent menu item – which looks increasingly likely."

Wendy's, which recently topped Burger King as the No.2 U.S. hamburger chain (though still far behind Mickey D), could come off a "so-so" Spring to report third-quarter sales up a big 5%, Kalinowski writes. His poll of McDonald's franchisees show many are so far unimpressed by their company's recent healthier but smaller product offerings.

POSTED: Monday, July 22, 2013, 10:07 AM
Aramark headquarters in Philadelphia. (Matt Rourke / Associated Press)

Aramark Corp., the Philadelphia-based college, stadium, workplace and hospital cafeteria manager, is laying the groundwork to sell shares to the public for the first time since it last went private in 2007, writes Jonathan Marino, senior editor at The Deal in New York, citing unnamed investment banking sources (who would love to see a deal happen and pick up a piece of the action). The Wall St. Journal has also speculated about a possible Aramark IPO. Aramark has not announced any IPO plans and hasn't been responding to media inquiries on the possibility. Last week the Inquirer reported Aramark is moving 300 back-office Philadelphia jobs to Nashville, Tenn. www.thedeal.com, subscribers only.

Aramark could sell shares at a price that would value the company at more than $10 billion, Marino speculated, citing recent share prices for rivals Pinnacle Foods Inc., Compass Group plc and Sodexho SA, though the valuation will depend in part on the company's debt load, which was partly refinanced this year at low market rates, but which still totals over $5 billion, according to Marino.

Aramark went public twice and was taken private twice during the years it was run by Joseph Neubauer, a Wall Street legend for his skill in boosting margins in mature industries like food service while also making money in both share sales and buyouts. "This might be the last transaction" for Neubauer, who has given up day to day control of the company but remains chairman, Marino told me.

POSTED: Monday, July 22, 2013, 9:23 AM
Customers Bank

Customers Bancorp Inc., the fast-growing Wyomissing-based lender run by Jay S. Sidhu, who built Philadelphia's former Sovereign Bank into the biggest bank based in eastern Pennsylvania, has hired Janney Montgomery Scott of Philadelphia and Boenning & Scattergood of West Conshohocken to sell $25 milion of 5-year, non-callable notes, at an interest rate still to be determined.

The money will fund "organic growth" by Customers, which has nearly $4 billion in assets and branches in metro Philadelphia, Boston and New York. It may also fund new acquisitions, Customers said in a statement. 

About this blog

PhillyDeals posts raw drafts and updates of Joseph N. DiStefano's columns and stories about Philly-area finance, investment, commercial real estate, tech, hiring and public spending, which he's been writing since 1989, mostly for the Philadelphia Inquirer.

DiStefano studied economics, history and a little engineering at Penn, taught writing at St. Joe's, and has written the book Comcasted, more than a thousand columns, and thousands of articles, and raised six children with his wife, who is a saint.

Reach Joseph N. at JoeD@phillynews.com or 215 854 5194.

Joseph N. DiStefano
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