Milling & Baking News - August 30, 2005 - 1

Theinewsweeklyiofigrain-basedifoods

I.B.C. ratifies long-term agreements
with two New York City unions
KANSAS CITY - Interstate Bakeries
Corp. last week said it has reached agreement with two of its local collective bargaining units affiliated with the International Brotherhood of Teamsters (I.B.T.) to
modify and extend the existing collective
bargaining agreements that govern their
employment with I.B.C. through July 31,
2010. These agreements have been ratified
by the members of the two local unions.
Documents memorializing these agreements either have been or are expected
to be executed in the near future and are
subject to bankruptcy court approval.
Members of Bakery Drivers Union Local 550 and Bakery Drivers and Salesmen
Local 701 (collectively approximately 500
employees) are employed in the New York
City metropolitan area.
"Negotiation and ratification of these ex-

BREAD

industry

perspective

tensions are important steps in our restructuring efforts," said Tony Alvarez II, chief
executive officer of I.B.C. and co-founder
and co-chief executive of Alvarez & Marsal, the global corporate advisory and
turnaround management services firm.
"This is just the beginning of a very long
process. With approximately 500 contracts
subject to negotiation, there is significant
uncertainty ahead." He noted that adding
a long-term, stable relationship with its
union work force along the lines of those
reached with Locals 550 and 701 is a key
component of I.B.C.'s restructuring efforts.
Mr. Alvarez said I.B.C. is attempting to
negotiate long-term extensions with the
remaining I.B.T. local bargaining units
within the Northeast Profit Center (P.C.).
Should the efforts to extend collective
Continued on Page 12

BREAD

industry

perspective

Baking companies retooling
businesses, product lines
Cheered by a range of successful initiatives, executives of
several commercial baking companies are upbeat toward
prospects for the bread industry. Optimism has been spurred
by improving profitability, better demand and new product
initiatives that have garnered extraordinary excitement
within the industry and beyond.
Still, "smooth sailing" would hardly be an apt descriptor for
the baking industry in 2005. Supermarket sales of bread in the
52 weeks ended July 17 totaled 3,278,558,000 units, down 3.1%
from the same period in 2003-04, according to data from Information Resources, Inc. While the results do not includes sales
in Wal-Mart or other supercenters and mass merchandisers,
the data indicate that the overall bread market has not been
growing and may be contracting further.
Volume trends were particularly poor for the nation's three
Continued on Page 27

inside

AUGUST 30, 2005

bakingbusiness.com / world-grain.com

LATE

NEWS
LONDON - Diageo P.L.C., the largest shareholder in
General Mills, Inc.,
has agreed to sell
approximately $1.3
billion of the Minneapolis-based company's shares
to Lehman Brothers Holdings Inc.
Under the agreement, Diageo has
the option to sell all of its remaining 25 million shares of common
stock of General Mills to Lehman
Brothers for $51.56 per share from
Nov. 4 to Nov. 10. The move follows Diageo's decision last year
to sell 49.9 million General Mills'
shares and falls in line with the
London-based company's larger
Continued on Page 10

Diageo to
sell General
Mills shares

U.S. flour output down
in second quarter and
first half of 2005
WASHINGTON - Flour production by
U.S. mills in the second quarter of 2005 decreased 0.3% from the same 2004 quarter,
according to the Bureau of the Census of
the U.S. Department of Commerce.
Output in the quarter totaled
96,439,000 cwts, down 334,000 from
96,773,000 cwts in April-June 2004. The
output in April-June was the smallest
for the second quarter since 2002, when
it was 96,276,000.
Production of flour by U.S. mills in the
first six months of 2005 decreased 0.6%
from the same period of 2004.
The North American Millers' Association provides funding to the Census
Bureau in support of the compilation
Continued on Page 42

THIS WEEK

Equity group
acquiring
Awrey
Bakeries

Ingredient

Abenante
opts for
early
retirement

Strong
sales and
earnings at
Flowers

Week

http://www.bakingbusiness.com http://www.world-grain.com

Milling & Baking News - August 30, 2005

Table of Contents for the Digital Edition of Milling & Baking News - August 30, 2005