Panera Bread Shacks Up With Krispy Kreme Investor; Nothing Smooth About a Recent Nivea Campaign; Payless Out. Chapter 11 In.

Yummm…

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Krispy Kreme needs to scoot on over and make some room over at JAB, the investment firm that controls it. It’s latest roomie is moving in and its name is Panera Bread. Panera is expected to fit in quite nicely at JAB, at least that’s what all the analysts keep saying, as the firm’s other entities include Peet’s Coffee and Tea, Caribou Coffee and Keurig Green Mountain Coffee. JAB will take the sandwich chain private for a tasty $7.5 billion, which comes out to about $315 per share and more than a 20% premium. And why shouldn’t JAB pay all that money? After all, the chain boasts 2,000 locations and pulls down annual sales of $5 billion. Of course it makes cash like that because it offers healthier options than most other fast-food chains, not to mention readily available wifi. For a fast-casual restaurant chain, it happens to be very tech forward. And don’t even get me started on the restaurants online ordering. Just. Don’t. Talk about a draw. Apparently JAB wants Panera to continue doing exactly what it does so well (translation: no changes) because it’s keeping all the execs in their current roles, including founder and CEO Ron Shaich. Wall Street’s was totally digging the news as well sending shares up to around $312 a pop. Add that to the fact that Panera has beat estimates for the last year and half, and JAB has got itself a pretty nifty deal.

Racist deodorant?

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Racist may not be the first word that comes to mind when you think about deodorant. But then again, that might be because you hadn’t yet heard about Nivea’s slogan in its ad for “Invisible for Black and White Deodorant.” According to marketing geniuses at Nivea, “White is Purity. ” And that’s precisely the slogan that was used to promote the product. I. AM. NOT. KIDDING. The ad was originally unleashed on the company’s Middle East Facebook page and social media did not take it well, with one outraged Twitter user writing: “Your comments are FULL of society’s refuse. This cleared your marketing department? #prnightmare.” Beiersdorf, the German company that counts Nivea amongst its holdings, wisely deleted the ad. Just not before white supremacists weighed in with their thoughts on the slogan, including this one:  “We enthusiastically support this new direction your company is taking. I’m glad we can all agree that #WhiteIsPurity.” The way white supremacists feel about an ad campaign would make a fairly good barometer, in terms of marketing efficacy, don’t you think? As to how the ad got past quality control in the first place remains a mystery.

And there’s nothing Star Jones can do about it…

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Another one bites the fiscal dust and this time the dubious distinction of filing for Chapter 11 bankruptcy goes to Payless Shoes. Even the likes of Tyra Banks and Star Jones wasn’t enough to save the Kansas-based chain from having to shut down around 400 stores in the United States and Puerto Rico. But that’s what you gotta do when your revenue tanks 4% just in the last year, and Amazon and deep-discount stores keep eating into your business. However, all is not lost, as Payless still has around 4,000 other stores in over thirty countries. The company just needs to do a little fiscal restructuring. But then again, don’t we all?

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Bugging Out Over VW Settlement; Trump Thinks He Can Do It All; Time to Buy a Keurig?

Buggin’ out…

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VW is getting set to pony up some $4 billion in settlement money after agreeing to plead guilty to charges of conspiracy to defraud the U.S. government and obstruct a federal investigation. To break it down, the company will cough up $2.8 billion in criminal fines and another $1.5 billion in civil penalties. With that settlement, the company achieves the dubious distinction of having the largest penalty ever levied by the U.S. government against an automaker. Pretty classy for Europe’s largest car manufacturer. But I guess that’s what happens when you get busted for trying to cheat on emissions tests. VW had initially insisted that the scheme was the work of a few isolated employees. But now, lo and behold, six German execs are now facing charges, and the arrests probably won’t stop there. While Oliver Schmidt was already arrested in Florida this week, the others are still biding their time in Germany, with no guarantee that they’ll meet with justice courtesy of the United States judicial system. And even though VW swears it’s changed its naughty ways and is cooperating fully with authorities, it’ll still be watched for the next three years – just to be sure. Shares of the company rose as much as 4% today, it’s highest price since the scandal first erupted. But that doesn’t mean that this unfortunate episode has come to an end as there are still plenty of other countries that could also very well pursue action against Volkswagen.

Not so sure about this…

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Looks like Trump’s not going anywhere. Not even away from his business empire. The President-elect, in a news conference today, discussed that he will not be selling off his global empire and put his liquid assets in a blind trust. However, his assets will still be placed into a different type of trust that will keep him from making decisions that would personally benefit him.  According to Trump’s flack, a blind trust wasn’t even a realistic option for Trump anyway since real estate can’t just be sold off so easily as stocks and other assets can.  Instead, he will remove himself from all business dealings, resign from all his positions and hand-off control to his two sons. It’s just not clear when he’ll actually stick to that plan since just this weekend he turned down a $2 billion development deal in Dubai. Speaking of which, his company will not enter into any new business deals abroad until after his term ends. How gallant of him. Domestic deals, however, are a whole other story. They’ll be permitted as long as they are met with approval from an ethics adviser hired to work specifically for the Trump organization. See how that works out? Ethics watchdogs aren’t down with Trump’s plan since they feel it will do little – if nothing – to prevent conflicts of interest. But ethics or not, the fact is, a President is not required by law to even avoid conflicts of interest. Donald Trump also stated that he could run both the White House and his business except that he won’t because it doesn’t look nice. Ya think?

Are you ready for this jelly?

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Savor that cup of coffee now because it’s about to get a bit more expensive. Well, that’s assuming it’s packaged coffee. The biggest coffee roaster in the U.S., J.M. Smucker Co – yes, the one that makes jelly – decided to raise the prices on its packaged coffees, including its Folgers, Dunkin’ Donuts and Cafe Bustelo brands. I did say a bit because that increase, on average, will only be about 6%, since the costs involved in producing green coffee have gone up as well.  But don’t bother blaming the jelly company execs. Blame Arabica coffee futures. Or rather, Mother Nature, since coffee futures have gone up 30% in the last year due to drought conditions in several coffee-producing regions. In all fairness, J.M. Smucker Co. actually decreased the price of its coffee last May courtesy of a Brazil oversupply. So I suppose things are just kind of even-ing out. Incidentally, K-cup pods are excluded from the price increase. So if you haven’t bought one of those nifty machines yet, now might be a good time to scoop one up.

Bill Gates’ Unappetizing New Venture; Have I Got a Jobs Report For You; Keurig Scores Dr. Pepper Snapple Exclusive

I’ll poop to that…

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Image courtesy of artur84/FreeDigitalPhotos.net

Bill Gates latest philanthropic endeavor is nothing short of crappy as the Microsoft founder plans to take human waste and turn it into…potable drinking water. And electricity too. But clearly it’s the water part that’s got people scrambling for their bottled water. With the help of the Omniprocessor, conveniently designed and built by Janicki Bioenergy, the Bill and Melinda Gates Foundation wants to help prevent the spread of diseases caused by water contamination and improve the quality of life in many underdeveloped countries. Oh the irony. With Senegal getting first dibs on a plant, the process can take waste from 100,000 people and convert it into 86,000 liters of potable water and a net 250 kilowatts of electricity. Be sure to see the pic of Bill Gates drinking a glass of the poop water. “Having studied the engineering behind it, I would happily drink it every day. It’s that safe.” That’s just…lovely.

Good Economic Synes…

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

Image courtesy of Stuart Miles/FreeDigitalPhotos.net

ADP graciously informs us today that 241,000 jobs were created in the private sector in December, smashing conservative estimates of 235,000 and making it the fourth straight month of job growth over 200,000. And while unemployment is expected to stubbornly stay at its 5.8% perch, but perhaps dip ever so slightly to 5.7%, signs still point to an expanding economy and a positive report from the Labor Department, expected Friday. But what’s even better, is that for the year, the private sector added more than 2.5 million jobs. Would it be overly optimistic to hope that the economy might return to full employment next year? Hmmm.

I’m a pepper?

Image courtesy of tiverylucky/FreeDigitalPhotos.net

Image courtesy of tiverylucky/FreeDigitalPhotos.net

Keurig Green Mountain just scored a sweet bubbly deal with Dr. Pepper Snapple to make individual capsules that will be used on Keurig’s cold beverage system, due out in the fall. The deal makes Keurig Green Mountain the exclusive provider in the US and Canada. Dr. Pepper Snapple, which also makes Sunkist and Hawaiian Punch, has been struggling along with its rival/competition soda makers to stay relevant in a market that is shifting away from sodas…and in some cases apparently, towards poop water. In fact, volume sales of carbonated soft drinks fell 3% in 2013. But for Keurig, based in Waterbury, Vermont, this was clearly seen as a positive move by Wall Street as shares of the company bubbled up more than 3% in pre-market trading.

Keurig Issues a Very Un-Merry Recall; Walgreens’ Happy Fiscal New Year; Barnes & Noble Regifts Itself, Sort of, With Nook Buyback

Ahhhh Keurig!!!

Image courtesy of lamnee/FreeDigitalPhotos.net

Image courtesy of lamnee/FreeDigitalPhotos.net

Looks like the automotive industry doesn’t have the monopoly on recalls this year, after all. Enter Keurig, beloved brewer of coffee and other hot beverages for millions. Following over 90 reports of people literally getting burned by their machines, Keurig recalled 7.2 million Keurig Mini Plus machines because they can overheat (imagine that) and spray hot liquid on its discerning coffee drinkers. Oh the horror. Not sure if your precious Keurig is on the recall list? Well, there are an estimated 6.6 million brewers that were recalled in the United States, with the rest purchased in Canada. The machines were made between December 2009 and July 2014 and were likely purchased at Kmart, Kohl’s Target, or directly from the Green Mountain website. In any case, rest assured that Keurig will ship you a repair kit FOR FREE. Of course, can you guess what the company stock did today? Yes it took a bit of a pre-Christmas nosedive and that’s in addition to the 5% drop in sales the company saw in its fourth quarter.

Out with the WAG, in with the WBA…

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Image courtesy of jscreationzs/FreeDigitalPhotos.net

Nothing says jolly like beating analysts’ estimates and Walgreens did just that. The health retail giant pulled in some impressive numbers for its fiscal first quarter with earnings of $809 million and $.085 per share. Analysts forecasted a paltry $0.74 per share. Analysts also called for revenues of $19.43 billion. But Walgreens instead pulled in close to $19.6 billion in revenues. In fact, shares of the company have pleasantly creeped up 29% in the past year. And while we bid farewell to 2014, it’s also time to bid farewell to retiring Walgreens CEO Greg Wasson. Wasson, who will not soon be forgotten – whether some people like it or not – orchestrated plans to takeover Swiss health and beauty company Alliance Boots. Part of the original plan was to pull off an inversion-type deal which did not exactly pan out. But what did pan out was Walgreens’ long-awaited foothold onto the international pharmaceutical/health/beauty market by just taking over the Swiss company. So bienvenu Walgreens. Or whatever it is they say there. With this new deal we shall also bid farewell to Walgreens presence on the New York Stock Exchange and Nasdaq under the ticker symbol WAG. Assuming the deal with Alliance Boots finalizes by December 31, Walgreens will now be traded only on Nasdaq, under the ticker symbol WBA, as part of the Walgreens Boots Alliance, Inc holding company. Sniff, sniff. As for the company’s 8,200 plus stores, expect to see some changes as the company looks to cut costs and trick out appearances.

Nook’d out…

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Image courtesy of adamr/FreeDigitalPhotos.net

It’s official. The Nook e-reader business is once again fully back in the arms of Barnes & Nobles. But don’t expect the reunion to last too long as Barnes & Nobles plans to spin it off on its own by August. The Nook, which turned out to be a big money loser and just couldn’t compete with Amazon and friends (and enemies), cost Microsoft $300 million back in 2012. Barnes & Noble graciously agreed at the beginning of the month to buy back the biz from the software giant for $125 million with Pearson Inc. still holding a stake in the company. But no more as Barnes & Noble paid $27.7 million in cash to the educational book publisher with $13.8 million in actual cash and 603,ooo shares of stock.  Wall Street liked the move as well and shares of the bookseller moved up a smidge.

Facebook Would Like to Like China, Coca Cola Getting Buzzed Over Keurig and Extra Credit Mortgages

Facebook headed in new directions?

Image courtesy of Master isolated images/FreeDigitalPhotos.net

Image courtesy of Master isolated images/FreeDigitalPhotos.net

Facebook is headed east. At least it wants to head east. Far east. The social media giant is looking to set up shop in Beijing but there is one slight hitch – Facebook is currently censored in China and has been for the past several years (as are Google and Twitter). Minor details, I suppose. Interestingly enough, though, Facebook still managed to make more than a few bucks in China by selling ads. The country currently has the largest amount of web users, coming in at a mind-numbing 600 million, yet it remains one of the last big markets that doesn’t enjoy all those FB perks. And while Facebook would be all too eager to tap in to that population, it did diplomatically say there are “substantial legal and regulatory complexities.” But tons of companies in China also want Facebook for the opportunities it provides to reach international users. Despite China’s Facebook ban, the company still managed to make $354 million in Asia which translated to roughly 19% of its first quarter revenue.

The buzz at Coca Cola…

Image courtesy of Paul/FreeDigitalPhotos.net

Image courtesy of Paul/FreeDigitalPhotos.net

As more and more people are looking to kick sodas from their diets, Coca Cola (KO) figured now is the time to up its stake in Keurig Green Mountain (GMCR) from 10% to 16%. Because the soda company recognized “substantial growth potential” it went ahead and scooped up close to 26 million shares. Now the beverage company best known for its tasty assortment of soft drinks has now became the largest shareholder in a company best known for its coffee and single cup brewing system. Coca Cola has used this play in the past when it ultimately bought out entire companies, including Zico Coconut Water and Honest Tea. In keeping with the spirit of icy cold Coca Cola, Keurig is planning to introduce a frosty single cup drink.

To your credit…

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Image courtesy of renjith krishnan/FreeDigitalPhotos.net

Government-owned Freddie Mac (FMCC) and Fannie Mae (FNMA) once upon a time received a $187 billion bailout courtesy of taxpayers. Freddie and Fannie are actually now cranking out record profits for the US treasury, having paid back all that taxpayer money (not that I saw any of it in my bank account). Now the Federal Housing Finance Agency (FHFA) overseeing the two companies (who guarantee about half of all mortgages) want potential homeowners/borrowers to get more credit. A far cry from last year when FHFA wanted to instead reduce the credit Freddie and Fannie (as those in the know call them) were offering. A move like that could drastically harm the housing finance market so the plans were scrapped. Now even if a borrower skips two payments in the first three years of the loan, Freddie and Fannie will still back those loans. There is now also a foreclosure relief project in the wings. However, the Senate Banking Committee is voting on a bill – with bi-partisan support – that would phase out Freddie and Fannie and let private lenders assume the risk instead.