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469 posts categorized "Austin news"

September 10, 2014

Workers at Lakeside Foods to lose jobs when Hormel ends contract

PLAINVIEW — About half of the year-round workers at Lakeside Foods workers learned last week that their jobs at Plainview's largest employer will be ending soon, as Austin's Hormel Foods pulls its contract with the plant.

4965162612_d023537c6b_oWhile the Manitowoc, Wis.-based Lakeside isn't releasing the number of jobs being cut, insiders are estimating that between 75 and 90 workers will lose their jobs when Hormel Foods pulls its production contract at the 650,000-square-foot plant.

Lakeside executives have previously said the Plainview plant employs about 80 full-time people, plus about 85 others that work solely on the Hormel contract. The Hormel contract with Lakeside to produce its Top Shelf products was a year-round contract.

Hormel says it plans to move that production to other facilities by late fall.

“This was a difficult decision to make, but moving the operations to other facilities within our company will provide greater production, purchasing and distribution efficiencies," said Donald J. Temperley, Hormel's vice president of Grocery Products operations, in a message this morning.

When the plant is packing seasonal vegetables, Lakeside's employment swells to a temporary peak of about 270 workers, who work 60 to 70 hours a week to get the fresh vegetables canned and frozen.

Plainview Economic Development Director Judith O. Jordan said when the community's largest employer loses such a major contract and needs to cut positions, it's a serious situation.

"We are all concerned about how this impacts Plainview. We hope Lakeside will be able to identify a new co-packer to work with to replace the Hormel production," she said.

The Lakeside Foods facility in Plainview is just one of eleven food processing plant in the Lakeside system. The Plainview facility is also one of six distribution facilities.

June 30, 2014

Hormel bulks up portfolio by buying maker of Muscle Milk

Austin-based Hormel Foods Corp. is bulking up its portfolio of companies by buying the maker of Muscle Milk protein drinks for $450 million.

UrlHormel, which produces Spam, Jennie-O Turkey and Skippy Peanut Butter among many other products, announced Monday evening that it had signed a deal to buy Benicia, Calif.-based CytoSport Holdings, Inc.

“Muscle Milk products will serve as a growth catalyst for our Specialty Foods segment, providing this division with a leading brand in the high-growth sports nutrition category,” stated Hormel CEO and President Jeffrey M. Ettinger in the press announcement. “The acquisition of CytoSport expands our offerings of portable, immediate, protein-rich foods, and broadens our appeal with younger consumers.”

Spammy2Muscle Milk power and drinks are used by many bodybuilders as muscle-building boost. It's considered the top brand in the ready-to-drink protein drink category. CytoSport launched Muscle Milk in 2000 and its grown to be its most popular brand. The company also makes other products like protein bars, oatmeal and ready-to-drink products.

Hormel anticipates CytoSport's total 2014 sales to hit an estimated $370 million. The deal is expected to officially close within 30 days.

CytoSport, which is owned by the Pickett family, first started talking to potential buyers in the fall of 2013. Hormel was considered a possible buyer from the start, along with Irish cheese maker Glanbia and Colorado-based butter and soy milk maker Whitewave Foods. The early pricing talk in 2013 was that CytoSport was looking for $500 million for the company.

Hormel already has a protein drink product line made by Hormel Health Labs, but HealthyShot drinks are aimed at medical patients and seniors who have trouble eating or swallowing.

This is acquisition follows another Hormel non-meat protein buy in 2013, when it bought Unilever's Skippy peanut-butter business for $700 million.

May 28, 2014

Analyst speculates that Hormel may be target of takeover bid

There's a lot of merger and acquistion activity cooking in the meatier aisles of the financial markets these days.

Spammy2The latest was Pilgrim Pride's surprise move to buy Hillshire Brands. Lots of investors with stock options profited from the $6.4 billion deal and that's leading to speculation about the next meat deal to hit the grill might be.

I spotted a very speculative column today on Barron's website by Scott H. Fullman of investment research firm, Increasing Alpha, on that topic. Fullman focused Austin's favorite Fortune 500 company and the creator of Spam, Hormel Foods, as a takeover candidate.

I have no idea if his theories make sense.

Here's some from Fullman's piece:

"Often when such an acquisition takes place, we look for other candidates. One stock seeing increased interest re Spamproductscently is Hormel Foods Corp, which rose back above its 100-day moving average Tuesday and was attempting to break above its 50-day moving average, but ended the day just below it. Momentum is rising sharply and volume is higher as well.

We are seeing a slight increase in implied volatility for Hormel, even as the shares jumped. The 30-day implied volatility is up more than 0.7% for calls, and down 0.8% for puts, indicating a sharp shift in bullish sentiment.

Despite the rise, those risk premiums are still close to their 52-week lows. Clearly, other traders are having the same thought as we are.

If you are looking for a low-cost, low-dollar-risk entry, consider purchasing the Hormel July $50 calls, which are offered at 40 cents. The delta on that option, which shows the current relationship between the movement of the stock and the option, is 23%, but it is expected to rise as the call becomes closer to being at-the-money, thereby increasing the leverage of the option. If the stock rises 10% from here to $52.58, the options will be worth $2.58, for a gain of $2.18 per share, or 545%. If the shares fail to rise, you will lose 40 cents per share, or 100% of your investment.

That compares, however, to a potential loss of $1.14 for those purchasing shares if the stock reverts to Friday's closing price.

Our suggestion is to purchase an equivalent number of calls to the amount of stock you can afford to buy, thereby keeping your risk in check.

April 28, 2014

Staples in Austin to close, but Rochester may stay open

While there's no official word, it appears Rochester's Staples office supply store is dodging the ax that the company is using to close 225 stores nationwide by 2015.

Store_1317_1However, the Staples store in Austin is not as lucky. That store at 1702 17th St. N.W. put up a "Store Closing" sign this week, though no one is saying exactly when the doors will shut for good.

The Rochester Staples staff also were busy last week.

Employees were out in full force working on "re-setting" the whole store at 3839 Marketplace Drive N.W. in the Rochester Marketplace shopping center, moving shelving and displays to update the look of the store.

While that is a not a certain signal that the Rochester store will not go the way of the Austin store and the others being closed, a store clerk casually chatting with customers at the cash register put the situation into perspective.

"It seems like a good sign, having us do all of this work," he commented. "At least we're not putting up closing signs."

The Massachusetts-based company has not replied to multiple requests for information during the past few weeks about the status of the local stores.

Staples has operated the 23,942-square-foot store in Rochester, since Twin Cities-based Ryan Cos. built it in 2002 as part of the Rochester Marketplace development. The shopping center now is owned by Inland Commercial Real Estate.

May 24, 2013

Hormel to Rev things up with new snack wrap

Here's some from a pice by Keith Nunes on Meatpoultry.com (A website with protein. Heh.) about Austin's favorite Fortune 500 company, Hormel Foods.
The maker of Spam is rolling out a new snack wrap line called REV.
REV branded snack wraps are being shipped to retailers nationwide and the company plans an advertising campaign in July to promote the new product. The new line is viewed by the company as a way to improve sales and operating income within its Refrigerated Foods business segment.

Hand_product“We are excited about the potential growth that our new Hormel REV snack wraps will bring to our Refrigerated Foods sales,” said Jeff Ettinger, chairman, president and CEO in a conference call with financial analysts on May 23.

The REV line of products will feature eight varieties, including: pepperoni, ham and cheese, peppered turkey, Meat Lovers Pizza, Italian style ham, hot pepper ham, Italian style, and spicy Italian style. Each wrap features a combination of meats, mozzarella cheese and a flatbread wrap.

Each 3-oz serving features between 15 grams and 18 grams of protein, a nutrition component that is called out on the package.

“We believe the investment we are making in the REV snack wrap rollout will establish the foundation for a beneficial new product platform for the Refrigerated Foods group,” Ettinger said.

During the second quarter of fiscal 2013, ended April 28, Hormel’s Refrigerated Foods segment had operating profit of $54,680,000, up 3 percent from $53,009,000 during the same quarter of the previous year. The segment had sales of $1,011,370,000, down 2 percent from $1,031,975,000.

Ettinger said the decline in the business unit’s sales was attributable to the planned reduction of slaughter levels at its hog processing operation and from exiting a feed sales business.

January 24, 2013

FTC OKs 'early termination' of Hormel/ Skippy deal

It looks like the Hormel folks in Spamtown USA might be able start spreading the peanut butter goodness in the near future.

TerminationRemember the deal where Austin-based Hormel made a deal with Unilever to buy the Skippy peanut butter brand for $700 million?

Well, the Federal Trade Commission granted Hormel's request for "early termination" this week. In case, like myself, you aren't sure what 'early termination' means, here's what that means:


Any person filing an HSR form may request that the waiting period be terminated before the statutory period expires. Such a request for "early termination" will be granted only after compliance with the rules and if both the Federal Trade Commission and Department of Justice Antitrust Division have completed their review and determined not to take any enforcement action during the waiting period. In some instances, after a Request for Additional Information and Documentary Material has been issued, the investigating agency will determine that no further action is necessary and terminate the waiting period before full compliance with the Second Request is made.

So it sounds like a good thing. The deal has been given the green light to speed ahead.

Can the new peanut butter favored Spam be far away? Heh.

January 10, 2013

S.E. Minn. is a pretty inventive area

Wrote the latest version of the annual IBM leads all other companies with U.S. patents story for today's paper.

I always enjoy the change to chat with some of IBM's master inventors and look at their patents. I often don't understand much, but I enjoy it. Heh.

This year I decided to see how many patents issued in 2012 included residents from area cities. I found some interesting stuff, including the fact a group of guys from Hormel in Austin were issued a new patent on a bacon bits making process on Christmas Day.

I hadn't look at these community numbers, since I wrote a big package in early 2010, where I determined that Rochester was the most inventive city inMinnesota and probably the U.S. (per 100,000 residents).

It is interesting to note that Rochester people had 488 patents issued to them in 2009, so the numbers have gone up considerably since then. I may need to take a run at this story again.

 

------------
This is a breakdown of how many patents issued in 2012 included at least one inventor from these southeastern Minnesota cities:

• Rochester — 652 patents

• Byron — 42 patents.
Patent-Office
• Stewartville — 10 patents

• Austin — 75 patents

• Mantorville — 27 patents

• Zumbrota — 12 patents

• Pine Island — 36 patents

• Dodge Center — 10 patents

• Lewiston — 14 patents

• Oronoco — 38 patents

August 25, 2012

New owner to take over, expand Med City liquor store

A Med City liquor store is about to go through the blender, but it's expected to have a familiar flavor when the new version is poured back into the mix.

Apollo Liquors is leaving its store at 3514 55th St. N.W. at the end of the month, when its lease ends.

However, a new owner is stepping into the spot to keep it going as Northwest Liquors, which is what it has been called for the past 10 years in the space next to Gander Mountain.

Irv Keefe plans to take over as the owner and re-open the store under the same name of Northwest Liquors. He has already hired most of the current staff and the manager to stay on there.

"Customers will still see the same faces, when they come in," he says.
Ganderapollo
Construction is under way to expand the store to 6,200 square feet from its current 4,500 square feet. Look for that work to speed up after Friday, when Apollo leaves.

Keefe hopes to re-open the new version of the store by mid- to late September.

He plans to use the additional space to bring in a 60-foot, state-of-the-art cooler to expand the store's micro beer offerings. He also will add more varieties of other products and a new wine tasting area to the store.

Meanwhile, Ari Kolas has his own project in the works. He is still putting the finishing touches on the deal, so watch this column for more details in the near future.

Once Northwest Liquors closes, Apollo will have four stores in Rochester. It also has a store in Austin, where the chain was originally founded by Nick Kolas.

Keefe says while he has long worked as a distributor in the alcohol business, this is his first step into the retail side of things.

"It is something I've always wanted to do," he says. "It is a challenge. I've always liked a challenge."

With the idea of eventually opening a store somewhere, he acquired an off-sale liquor license from the city of Rochester back in March.

"There were only so many of them," Keefe explains. "So I decided to grab one while I could."

Some buzz has been going around that this new store will be linked to Rochester's Chafoulias family. They own Apollo's prime competitor, Andy's Liquor.

Not so, says Keefe. He explains that he is the owner, not the Chafoulias family.

The only connection to the Chafoulias family is that he does work for their company, Titan Development Group.

August 23, 2012

Tire centers change ownership

To give his tire business more traction in this region, Jerry Bauer of Bauer Built Inc. bought two Hanson Tire Service centers this week.

On Monday, the Durand, Wis.-based Bauer Built took over Hanson Tire's original headquarters in LeRoy along with a location in Preston. While the center will eventually change names, they will remain under the Hanson Tire name for now.

03bauer1"Our normal trend is to transition places we acquire over to the Bauer Built name sooner than later, but we're keeping these as Hanson Tire for a while," Bauer says. "They've been a very successful business, since 1953."

Almost all of Hanson's 20 employees are staying on under the new owner. Former owners Randy Eastvold and Greg Rollins, along with Ron Eastvold, are helping with the transition.

Bauer declined to discuss the financial terms of the acquisition.

These additions bring the tally of Bauer Built tire centers to 31, including ones in Rochester, Red Wing and Albert Lea. They also have seven Michelin retread plants, three wheel refinishing facilities and a bulk petroleum operation.

A second generation, family-owned business, Bauer Built was  founded by Sam Bauer in 1944.

Why add the LeRoy and Preston centers to the company's extension portfolio of facilities?

"We are always looking for going concerns that are profitable. They have many comparable products and they are very strong in agriculture," he says. "They will help us grow in that area."

Another reason is obvious from a quick look at the map. Bauer has locations surrounding the new additions.

"Geographically, they will fit in well and fill in some voids for us," he says.

This deal does not have any links to Hanson Tire of Austin, which has a different owner. The same is true of the Hanson Tire in Albert Lea, which has another owner.

Hanson Tire, started by Don and Donna Hanson in 1958, grew to 11 stores at one point. It was then recognized as the largest tractor and truck dealer in the nation.

There was once a Hanson Tire location in Rochester, but no longer.

July 11, 2012

75-year-old Spam rings a bell

Spam and the Big Apple = a tasty combo?

Hormel Foods CEO Jeffrey Ettinger made the trip from Austin to New York City Tuesday to mark the 75th anniversary bring ringing the closing bell for the New York Stock Exchange.

 

Here's a quick vid from CNN chatting with Ettinger. He dodges the question Hillshire Farms pretty smoothly and gives a shout out for Austin, "the town that Spam built."   6a00d83451cc8269e20176165b9d12970c-250wi

 And here's a pic of the Spam-flavored lip balm...just because that product still amuses me. Heh.