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Expansion Plan at Wal-Mart Canada
Wal-Mart Canada Corp., which will open its 300th store in Canada this spring, has announced plans for up to 27 new real estate projects by the end of January next year. Half of the projects will involve the building of new stores – with almost all of them classified as "supercentres" – and will sell a full range of groceries in addition to general merchandise. The rest will involve the expansion or relocation of existing stores, according to the retailer. http://www.reportonbusiness.com/servlet/story/ RTGAM.20080508.wwalmart0508/BNStory/Business/home Spurce: Canadian Grocer E-Newsletter, May 14, 2008

George Weston Profit Up After Loblaw Cuts Costs
George Weston Ltd.'s first- quarter profit rose 26% after its Loblaw food unit reduced expenses. Net income climbed to $131 million in the period through March 22 from $104 million a year earlier. Sales rose to $7.34 billion from $7.22 billion. Weston's Loblaw Cos. Ltd. reported earnings gained for the second consecutive quarter as restructuring costs decreased. Weston's bakery unit closed inefficient bakeries and raised prices as costs for flour advanced and it developed whole-wheat breads. http://www.bloomberg.com/apps/news?pid=20601082&sid=ar5VljSdwDLM&refer=canada Source: Canadian Grocer, E-Newsletter, May 14, 2008

Sobeys Debuts 'Urban' Store in Edmonton
Sobeys unveiled its "Urban Fresh" store format in Edmonton last week. The 18,000-sq.-ft. store is Sobeys' first banner in the downtown area and features a smaller selection than the company's suburban grocery stores, while emphasizing fresh and prepared foods in a European-inspired design. Reports said Sobeys is preparing a second Urban Fresh store in Edmonton to open later this year. Source: Canadian Grocer E-Newsletter, May 12, 2008

Baskin-Robbins Co-founder Passes Away at 90
Irvine Robbins passed away at his home in California last week at the age of 90. Robbins was born in Winnipeg in 1917 and opened his first ice cream store in 1945. His brother-in-law, the late Burton Baskin, opened his own ice cream store in Pasadena a year later and the two eventually joined forces. Source: Canadian Grocer E-Newsletter, May 12, 2008

Shoppers to Open New Beauty Stores
Shoppers Drug Mart is going after a higher stake in the Canadian beauty market by launching a new store banner. Aside from a full-service pharmacy, the new stores are intended to offer an upscale beauty experience with an extensive selection of skin care and dermatological products, full range of prestige cosmetics and fragrance brands. The new banners will not run under the Shoppers Drug Mart name, though a new name has not been made public. Source: Canadian Grocer E-Newsletter, March 28, 2008.

Wal-Mart Plans Biggest U.S. Store
Wal-Mart plans to open its biggest U.S. store on the outskirts of Albany, NY, report US media sources. The store—a two-storey, 260,000 sq.- ft. supercentre—will sell department store merchandise as well as groceries, liquor and provide automotive services. Source: Canadian Grocer E-Newsletter, March 28.2008

Wal-Mart Brand Milk in U.S. Hormone Free
U.S. Wal-Mart Stores Inc. is selling milk free of bovine growth hormone under its own label as part of an expansion of organic and health-oriented goods. The milk will be sold under the Great value brand at Wal-Mart and Sam's Club stores. Source: Canadian Grocer E-Newsletter, March 24, 2008.

GSW Launches Opportunities Pavilion
One of the attractions of Grocery Showcase West, produced by the Canadian Federation of Independent Grocers, will be the launch of the new 2010 Olympic Opportunities Pavilion. The 16 exhibit "super pavilion" will feature unique and innovative products from Western Canada. The trade show, in Vancouver, will take place April 27 to 28. Source: Canadian Grocer E-Newsletter, March 24, 2008.

Wal-Mart set to open 'green' store
BENTONVILLE, Ark. – Wal-Mart Stores Inc. will open its latest generation of energy-efficient test stores this week with a Las Vegas Supercenter that uses new cooling technology to cut overall energy use by up to 45 per cent. The Las Vegas store opening Wednesday builds on advances in earlier pilot stores that reduced energy use in areas including lighting, refrigeration and water flow. The previous pilot stores in the Midwest cut energy use up to 25 per cent compared to a typical Supercenter built in 2005, the year Wal-Mart launched a broad environmental program to reduce energy use and packaging waste and to sell more sustainable products. Wal-Mart said the new Las Vegas store adds to those savings with a new cooling system based on water evaporation for total energy savings of between 35 per cent and 45 per cent. Wal-Mart has said it is the biggest private user of electricity in the world and has huge potential to cut back on greenhouse gases from fossil fuels burned to create electricity. It aims to use technologies proven in the pilot stores to develop a prototype in 2009 for all new Supercenters that will be between 25 per cent and 30 per cent more energy efficient. An outside engineering and efficiency expert said Wal-Mart's advances in saving energy, including the new Las Vegas store, are leading the field for big-box retailers. "This is not just a baby step. This is a big step," said Terry Townsend, past president of the American Society of Heating, Refrigerating and Air-Conditioning Engineers. Townsend said Wal-Mart's pilot stores are important because they show other retailers how to use available technology to improve energy efficiency. Wal-Mart says it is sharing its lessons with retail industry groups. The latest store is built specifically for the arid climate of Western states, where water evaporates faster than in the more-humid East. It uses rooftop cooling towers to chill water that then runs in conduits under the floor of the store. The radiant cooling from the floor replaces traditional electricity-powered air conditioning. The store also incorporates innovations from the previous pilot stores that include recycling heat from refrigerators and combining low-power LED lights in freezer cases with sensors that turn off those lights when no customers are around. Source: Marcus Kabel ASSOCIATED PRESS, Toronto Star March 18, 2008

SDM to Debut Organic Food Line
In the second quarter of this year Shoppers Drug Mart Corp. will debut a new line of organic products called Nativa. According to CEO Jurgen Schreiber, people are buying more organic products and they accept slightly higher prices. A pilot test of Nativa conducted in a handful of stores was successful, according to Schreiber. The line will include 170 packaged food items nationally. Source: Canadian Grocer E-Newsletter, March 7, 2008.

J.M. Smucker to Acquire Europe's Best
The J.M. Smucker Company has announced that it has entered into an agreement, through subsidiary, to acquire Europe's Best, Inc., a privately owed company headquartered in Montreal that specializes in frozen fruit. Europe's Best is expected to add $70 million in net sales and be slightly accretive to earnings for fiscal 2009. Europe's Best's administrative functions will relocate from Montreal to Markham, ON. Source: Canadian Grocer E-Newsleter, March 7, 2008.

J.M. Smucker to Acquire Europe's Best
The J.M. Smucker Company has announced that it has entered into an agreement, through subsidiary, to acquire Europe's Best, Inc., a privately owed company headquartered in Montreal that specializes in frozen fruit. Europe's Best is expected to add $70 million in net sales and be slightly accretive to earnings for fiscal 2009. Europe's Best's administrative functions will relocate from Montreal to Markham, ON.

Sobeys Store at Calgary Polytechnic
Sobeys has opened a convenience store at Calgary's Southern Alberta Institute of Technology Polytechnic. This is the first convenience store for Sobeys in the West. In addition to basic grocery and fresh food items for students and guests staying at on-campus residences, the store will also feature a selection of fresh in-store made meal solutions. Source: Canadian Grocer E-Newsletter, February 29, 2008.

SKUs Sooner to Shelves—Loblaw
Loblaw Cos. Ltd. says it can cut the time it takes to get products on shelves in half by overhauling the supply chain that gets goods from suppliers to stores. A new system, called "Flow," will eventually replace Loblaw's current 'stock and ship' method. The grocery chain also announced plans to revamp stores and drop prices as part of its five -year turnaround strategy. Source: Canadian Grocer E-Newsletter, February 29, 2008.

Grocery Stores Try Digital Coupons
Supermarket chains are experimenting with paperless, or digital, coupons, to help eco-minded shoppers save time and money. Shoppers load the online discounts on to their store loyalty cards, receiving the credit at the checkout. Grocers see the innovation as a way to build customer loyalty, drawing customers to their websites and ultimately, their stores. Kroger Co., the largest traditional grocery chain in the United States, and Procter & Gamble Co., the largest consumer products company, have partnered in a digital coupon trial that began in December. Source: Canadian Grocer E-Newsletter, January 25, 2008

Sears to break into several companies
HOFFMAN ESTATES, Ill. (AP) -- Sears Holdings Corp. plans to reorganize into several companies in another bid to pull the ailing 121-year-old retailer out the doldrums, according to a report published Saturday. The restructuring could create separate units to manage Sears (SHLD, Fortune 500) real-estate holdings and run brands such as Diehard and Craftsman, the Wall Street Journal reported. Edward Lampert, the hedge fund kingpin and Sears Holdings chairman, sees the move as a way to revitalize the company in the face of tough competition from companies like Wal-Mart Stores Inc., (WMT, Fortune 500) the newspaper said, citing unnamed people familiar with the situation. Details, including which units might run the Hoffman Estates, Ill.-based company's 3,800 Sears and Kmart stores in the United States and Canada, weren't clear. Spokeswoman Kimberly Freely issued a short statement Saturday confirming Sears Holdings is "introducing an organizational structure that provides operating businesses with greater control, authority and autonomy." She declined to comment further. Analysts say the changes contemplated by Lampert - who acquired Kmart in 2003 and Sears, Roebuck and Co. in 2005 - run against prevailing trends where retailers try to craft a single, cohesive business image. Sears' problems deepen "He's looking to turn it around by using a different approach," said retail consultant Walter Loeb. "I think it's risky." On Monday, Sears Holdings told investors it would likely post fourth-quarter earnings well below Wall Street forecasts as eroding sales push its profit down as much as 57 percent. It expects to earn between $350 million and $470 million, or $2.59 to $3.48 per share, for the quarter ending Feb. 2 - far less than the $4.43 per share sought by analysts surveyed by Thomson Financial. Sears earned $820 million in the fourth quarter a year earlier. Sears blamed growing competition, a slowdown in the housing market and consumers' credit fears for slumping sales figures. Source: CNN.com January 19, 2008

Canadian Grocer Voted One of Canada's Most Influential Magazines
Canadian Grocer has been named one of Canada's most influential magazines of all time by Masthead magazine, a trade publication covering the Canadian magazine industry. "If a trade magazine's influence is best weighed within the business community it serves, then Canadian Grocer is the watermelon of b-t-b titles in this country," wrote Marco Ursi editor of Masthead in the publication's January/February issue. A panel of five industry experts made the selection. Other magazines on the 20 most influential list were Chatelaine, Maclean's, Flare and Canadian Business. Source: Canadian Grocer E-Newsletter, January 18, 2008

Wal-Mart U.S. to Test Smaller Grocery Stores
Wal-Mart Stores Inc. will open four small-format grocery stores under the name "Marketside" to rival British retailer Tesco. According to Wal-Mart, the new 20,000- sq.-ft. units will open in Arizona this year and are aimed at shoppers who find big stores inconvenient. Some industry observers believe the new format stores are Wal-Mart's way of competing with Tesco's new Fresh & Easy stores just opened in the United States. Canadian Grocer E-Newsletter, January 18, 2008

Ontario Will Not Ban Plastic Bags
Premier Dalton McGuinty of Ontario said his government has no plans to ban plastic shopping bags. However, a Toronto city task force is working on a plan to sharply reduce packaging such as shopping bags, throw away coffee cups and "clamshell" takeout containers. Mayor David Miller said the city does not have the legal jurisdiction to ban in-store packaging. Environmental activists have said that if voluntary measures don't work, they would call for a ban. They have suggested that the province charge 20 cents a bag. Loblaw Cos. Ltd. recently reported that it's on track to achieve its goal of diverting one billion plastic bags a year from landfills. The grocer opened Canada's first bag-less store in Milton, Ont. last August. http://www.thestar.com/article/292025 Source: Canadian E-Newsletter, January 18, 2008

Produce Traceability Lays Groundwork for Standards Program
The steering committee of the Produce Traceability Initiative, launched by the Canadian Produce Marketing Association (CPMA), Produce Marketing Association (PMA) and United Fresh Produce Association (United), has laid the groundwork for a produce traceability initiative. The move is an industry-led effort to adopt traceability throughout the produce supply chain. The committee concluded that an application of common standards across the supply chain is needed to enhance industry-wide traceability, building the next step beyond many of the internal systems that now exist. The committee agreed that the GS1 produce traceability standard is the most efficient worldwide approach to achieve system-wide tracking. A formal timeline for adoption of standards is needed, said the committee. In addition, it concluded traceability standards should be adopted at the case level initially. However, businesses were encouraged to move toward item level coding as feasible. The steering commi! ttee will meet in the next two months to form subcommittees that would address these specific initiatives. Source: Canadian Grocer E-Newsletter, January 18, 2008.

Wal-Mart's Round-the-clock Strategy
During the recent holidays, 190 Wal-Mart stores remained open 24/7. The chain's original plan was to open 80 stores but popular response, said Wal-Mart, encouraged it to more than double the number of stores. Following the holidays, a select number of stores, located in smaller cities as well as the Greater Toronto Area, were chosen to remain open 24/7. Wal-Mart says the new hours will serve shift industry workers and families with tough schedules. Store traffic tends to peak between midnight and 2 a.m. and in the pre-morning rush, starting at about 5 a.m. Source: Canadian Grocer E-Newsletter, January 11, 2008.

Ambitious Growth Plans for Canadian Tire
Canadian Tire plans to open 60 to 70 new stores per year over the next five year, boosting retail revenue by 6% each year. The 468-store chain plans to invest more than $2.6 billion to realize its expansion strategy. The company has experienced healthy results at its gas bars and financial services division helping increase profit 11% to $105 million in the third quarter, despite the impact of Canada's rising dollar on jobs in the manufacturing sector and weaker than usual sales in Quebec and Ontario. Source: Canadian Grocer E-Newsletter, Nov. 30, 2007

Some Wal-Mart Stores to Stay Open 24 Hours a Day
About 80 of Wal-Mart's 298 Canadian stores will open 24 hours a day from Dec. 1 to Christmas Eve. Last year, 59 of its stores were open 24 hours a day for a week starting on Dec. 18. In deciding which stores would be open for 24 hours during the holiday season, Wal-Mart pored over sales date, market information and local bylaws. The company will make public the store locations on a special website, www.walmart24hours.ca, after Dec. 5. In addition to boosting sales, delivering convenience to holiday shoppers was the main driver in the decision to open the stores, said Wal-Mart.Source: Canadian Grocer E-Newsletter, Nov. 30., 2007

A&P U.S. Sells Its Metro Inc. Shares
The Great Atlantic & Pacific Tea Company has sold all of its 11,726,645 shares of Metro Inc. for approximately US$347 million. Some 1,500,000 of the shares were bought by Metro. The sale will help A&P finance its purchase of Pathmark Stores in the United States. Montvale, N.J.-based A&P expects that it would complete its US$1.3 billion acquisition in early December. The A&P/Pathmark transaction was delayed by anti-trust investigation by the Federal Trade Commission (FTC). A&P has now agreed to sell an unspecified number of stores at the behest of the FTC. A&P operates 337 supermarkets and Pathmark has 140 in New Jersey, New York and Philadelphia. Source: Canadian Grocer E-Newsletter, Nov. 30, 2007

Clorox Co. Buys Burt's Bees
Clorox Co. has purchased beauty product manufacturer Burt's Bees for US$925 million. Burt's Bees, a North Carolina-based company, manufactures beauty products that contain a least 95% natural ingredients. The purchase is part of the Clorox strategy to expand into the natural beauty products industry. Source: Canadian Grocer E-Newsletter, November 2, 2007

GIC Trade Show and Conference "Fantastic"
John F.T. Scott, president and CEO of the Canadian Federation of Independent Grocers, which produces the Grocery Innovations Canada (GIC) trade show and conference, described this year's (Oct. 29 to 30) version of the gathering in Toronto as "fantastic." He said that GIC 2007 "was the most valuable event Canadian independent grocers have ever attended. The board of directors was overwhelmed by the positive feedback received." The gathering featured 500 exhibits, panel discussions, notable speakers and award ceremonies. Source: Canadian Grocer E-Newsletter, November 2, 2007

Wal-Mart Canada to Introduce George Home
George Home is scheduled to arrive soon into Wal-Mart Canada stores. United Kingdom-based George Home brand includes bed, bath, dining and home accessories, with 270 product 'lines' averaging $20 million per month in sales. With Wal-Mart sales slowing down in the United States, the company said that 80% of new store square-footage expansion will take place in Canada, Mexico and China. Source: Canadian Grocer E-Newsletter, Oct. 31, 2007

Flaherty Pressures Retailers to Lower Prices
Finance Minister Jim Flaherty has urged Canadian retailers to lower their prices to reflect the strong dollar but many say they don't control costs. Retailers say their suppliers are charging unfair rates and they're in a difficult predicament. If they lower their prices to reflect the strong dollar, they'll lose money. But if they keep prices the same, they'll lose customers to the U.S. Some retailers have already started lowering prices in response to a massive consumer backlash and rise in cross-border shopping. Wal-Mart Canada has rolled back prices on about 8,000 items in the past few months, ranging from 10 to 25%, and is selling some video games at the U.S. price. Zellers has cut prices on 250 household products. "With the strength of the loonie and customer expectations climbing, there is a new standard for price leadership," said Mario Pilozzi, Wal-Mart's CEO. Source: Canadian Grocer E-Newsletter, Oct. 31, 2007

Lassonde Acquires McCain Foods Ready-to-Drink Fruit Drinks
A. Lassonde Inc. and parent company Lassonde Industries Inc., based in Rougemont, Que., has announced that it has concluded an agreement to acquire assets related to the manufacture and marketing of McCain Foods (Canada) ready-to-drink fruit juices and fruit drinks. The deal is worth $13.9 million and will also see Lassonde acquiring a juice plant in Calgary, production equipment being transferred from Toronto and Grand Falls, N.B., and trademarks and licensed use of the McCain trademark for periods of up to three years. Source: Canadian Grocer E-Newsletter, Oct. 31, 2007

Ethanol Popularity Increases Food Prices
Conversion of corn to ethanol is raising food prices while delivering dubious energy benefits, according to Jeff Rubin, chief economist at CIBC World Markets. Corn prices have rocketed by 60% in the past two years as United States producers have expanded capacity. Rubin said that next year food inflation will hit the 5% mark and in 2009 it will approach 7%, its highest level in more than 25 years. "Soaring corn prices not only pass directly into animal feed costs and corn-based food prices like tortillas, but they are having an impact on other grain prices as farmers attempt to expand corn production at the expense of other crops," said the economist. Source: Canadian Grocer E-Newsletter, Oct. 31, 2007

Unit Sales Help Raise Maple Leaf Foods Profit
Maple Leaf Foods posted significant profit ($220.4 million) in its third quarter helped by the sale of its livestock-feed business. The strong Canadian dollar and the rising grain costs hurt the company's meat and bakery business. The profit included $217.7 million gain from the sale of its livestock business to a Dutch food group. "The food industry continued to battle unprecedented food inflation related to wheat, corn and other input costs, in addition to the ongoing rise in the Canadian dollar," said chief executive Michael McCain. Source: Canadian Grocer E-Newsletter, Oct. 31, 2007

GIC '07 Promises Fresh Ideas
The 8th annual Grocery Innovations Canada (GIC) trade show and conference (Oct. 29-30) at the Toronto Congress Centre, promises to offer attendees plenty of information on trends, issues and innovations impacting grocery stores. The GIC '07 will feature more than 500 exhibits and will attract more than 6,000 grocery industry representatives. Speakers at the conference will include Tim Penner, president of Proctor & Gamble and Bill McEwan, president & CEO of Sobeys. A panel discussion will also provide insights into some of the best-managed companies in Canada and will be comprised of Frank Coleman of Colemans Food Centre, Newfoundland; Anthony Longo of Longo Brothers Fruit Markets in Ontario; and Milford Sorensen of Thrifty Foods in British Columbia (stores recently sold to Sobeys.) A luncheon on Monday will honour industry achievers including entrepreneur, Jim Pattison, who ! will be receiving the Canadian Federation of Independent Grocers' "Spirit of the Independent Award." Source: Canadian Grocer E-Newsletter, October 5, 2007.

Carnation Acquired by J.M. Smucker
The J.M. Smucker Company has announced its subsidiary, Smucker Foods of Canada Co., has acquired the Canadian Carnation brand canned milk products business from Nestlé Canada. Terms of the transaction were not disclosed. The current line of Carnation branded milk products marketed in Canada has an annual net sales of approximately $50 million. Source: Canadian Grocer E-Newsletter, October 5, 2005.

Health Canada Looks to Clearer Labels
Health Canada and the Canadian Food Inspection Agency are responding to consumers who are confused by the statements about the possible presence of allergens in food. Health Canada said it is reviewing the labelling of items often associated with food allergies and allergic-type reactions. Food manufacturers, importers, distributors and retailers are being notified of the proposed changes. Proposed terms include "may contain..." or "Not suitable for consumption by persons with an allergy to..." Source: Canadian Grocer E-Newsletter, October 5, 2007.

High Liner Swings to Profit in Q4
High Liner Foods Inc. says it has rebounded in its fourth-quarter, posting a profit of $1.3 million, which compares to a loss of $44.5 million that the company posted a year ago. In Q4 of 2005 the Lunenburg, N.S.-based company was impacted by a huge write-down related to the sale of its Italian Village pasta business. With renewed focus on its core seafood business, High Liner said sales for the quarter ending December 31, 2006, increased 5.5% reaching $65.7 million. Source: Canadian Grocer E-Newsletter, February 23, 2007.

Canadian Grocery Shoppers Ready for RFID, Survey
Although RFID tagging is still in the experimental stage in Canadian grocery stores, a new survey by TNS Canadian Facts reveals Canadians are keen on the technology. The market information group said its recent online survey of 1,056 primary grocery shoppers revealed that three-quarters of respondents said they would be willing to try out a checkout lane enabled with RFID technology and more than half (56%) said they would prefer using an RFID lane to ring up their purchases. With industry studies showing that waiting times at checkouts could be reduced by 30% with this technology, consumers are attracted to the convenience and time-saving benefits of RFID, says TNS. And while 40% of those surveyed had some concerns over security, privacy and safety regarding RFID, TNS said about three-quarters of respondents were more worried about the cost of the technology and that it might not work properly. Source: Canadian Grocer, E-Newsletter, February 23, 2007.

U.S. retailer buyout activity increasing in Canada
Without a doubt, we are really seeing the Americanization of the Canadian retail sector. And with the world awash in private-equity money and cheap credit, more potential foreign buyers have put Canadian retailers on their radar screens. In the past six years, foreigners have bought some of Canada's biggest and best-known retailers. Much has obviously changed since Wal-Mart entered Canada in 1994, not least that Canadians have learned to expect better from their retailers. Now that shoppers have become better served, investors are starting to benefit as well. Thanks to the strength of the Canadian economy, retail has ended its long drought as one of Canada's most moribund sectors for investors. The retailers and buyout firms see a Canadian economy that is strong - and possibly more resilient than the economy of the United States. The retail sector is also less competitive than it is in the U.S., which has more stores per capita. All that is missing are Canadian buyers. There are few private-equity firms of any consequence in Canada. National Post - 12/23/06 Prediction: Supermarkets to accommodate drive-through shoppers Source: Vancouver Sun Expect a new kind of fast-food in 2007. This year a major supermarket group will introduce a drive-through concept that will allow working moms and other time-challenged consumers to buy prepared and ready-for-microwave meals from the comfort and security of their ride. That prediction comes from Harry Balzer, vice-president of the consumer marketing research firm NPD Group and an expert on food and diet trends who has studied North American eating habits for 25 years. Vancouver Sun - 01/08/07 Source: Lana Holmes & Associates Ltd. with Tim Carter & Associates Inc.

More changes in high places for Loblaw
Troubled Loblaw [has taken] another big step in trying to restore its battered supermarket franchise. In comes the stylish Dalton Philips, 38, as Loblaw's chief operating officer, after a short stint as CEO of Brown Thomas, the 157-year-old Irish retailer that, like Loblaw, is part of the Weston family empire. Out goes Dave Jeffs, 48, a 28-year Loblaw veteran whose major sin is that he was part of a senior team headed by former president John Lederer, which is being tarred with the faulty execution of the chain's Stop Wal-Mart strategy. The changes herald a revolution in style as much as substance, as new Loblaw boss, 34-year-old family scion Galen Weston Jr., puts his stamp on leadership. Loblaw spokesman Geoff Wilson said there will be more executive changes as Mr. Weston Jr., the executive chairman, continues to look at ways to streamline his company and restock his management ranks. Source: Lana Holmes & Associates Ltd. with Tim Carter & Associates Inc. Globe and Mail - 01/06/07

Canadian food retailers jumping onto high-tech bandwagon
Canadian retailers are shopping for the future [and] store owners are now turning their attention to high-tech marvels that will ultimately transform the shopping experience. In this new landscape, self-serve checkouts will get smarter, displays will point customers directly to the product they're looking for and downloading will no longer be limited to Internet websites. The change has already started. In Wal-Mart's new Canadian Supercentres - larger stores that offer a full line of groceries - shoppers have already been introduced to 32-inch LCD screens strategically placed above the cash registers. Initially, this in-store television network will broadcast a combination of store-specific advertising content and company information directly to customers while they shop. As the program expands, larger 46-inch LCD screens will start to appear in departments such as fashion and produce. They will feature department-specific information ranging from updates on the newest clothing items to food-preparation tips. Source: Lana Holmes & Associates Ltd. with Tim Carter & Associates Inc. Business Edge -12/22/06

Loblaw Liquidating Excess Non-Food Goods
Loblaw says it will liquidate its excess inventories of kitchen accessories, bed and bath products, electronics and more—a move that will cost the retailer a pre-tax charge of between $100 and $120 million in Q4. Toronto-based Loblaw will continue selling these types of products, but says eliminating the excess inventory will help improve the efficiency of its supply chain operations. The retailer, which has been struggling with supply chain issues as it faces heightened competition from Wal-Mart, said it is focused on simplifying, innovating and growing its business. Source: Canadian Grocer E-Newsletter, Jan. 5, 2007.

Nestlé to Buy Novartis Food Unit
The world's biggest food and drink company, Nestlé SA has reached a US$2.5 billion deal to buy the medical nutrition unit of Swiss pharmaceutical giant Novartis. The deal does not include, however, Novartis' infant nutrition division, Gerber Products. Nestlé says the acquisition is in line with its focus on becoming a nutrition, health and wellness company and follows its recent US$600 million purchase of U.S. food company Jenny Craig. The deal, which is still subject to regulatory approval, is expected to wrap up in the second half of 2007. Source: Canadian Grocer E-Newsletter, December 15, 2006.

7-Eleven Plans North American Expansion
Competition from supermarkets and rival c-stores has prompted 7-Eleven to start serving up hot meals and to expand its number of North American outlets by 30%. North America's largest convenience store chain says it will open about 2,000 new stores in Canada and the United States by 2010; 7-Eleven currently operates 6,100 outlets in the two countries. The company also said it will cater to North America's growing appetite for prepared meals by offering such things as hot pasta dishes, meat loaf and mashed potatoes at it outlets. Source: Canadian Grocer E-Newsletter, December 15, 2006.

Sobeys Posts Slightly Higher Earnings
Higher sales helped Sobeys' second-quarter earnings edge up slightly to $47.2 million from $45.8 million a year ago. The Stellarton, N.S.-based grocery retailer also reported that sales for the period ending November 4, 2006 increased 2% to $3.25 billion from $3.19 billion while same-store sales were up 2.4%. Sobeys' parent Empire Company also reported a profit rise with earnings reaching $57.2 million, up from $48.6 million a year ago, with revenues reaching $3.31 billion (up 2%). Source: Canadian Grocer E-Newsletter, December 15, 2006.

Sobey Brothers Named to Hall of Fame
David Sobey, chairman emeritus of Sobeys Inc., and Donald Sobey, chairman emeritus of Empire Company Ltd., are to be inducted into The Canadian Business Hall of Fame. Both will enter the Hall of Fame—which recognizes outstanding business achievements and contribution to society—in 2007 as Sobeys marks its 100th year. The two brothers follow their father Frank Sobey who was inducted to The Canadian Business Hall of Fame in 1984. Source: Canadian Grocer E-Newsletter, December 15, 2006.

Get Ready for Grocery Showcase West
April 15-16: CFIG's Grocery Showcase West, 18 th Annual Spring Conference and Trade Show, Vancouver Convention & Exhibition Centre, www.cfig.ca. Source: Canadian Grocer E-Newsletter, December 11, 2006.

Five Retailers Elected to CFIG's Board
The Canadian Federation of Independent Grocers has announced the election of five retailers to its board of directors: John Briuolo of Quality Foods; Joey Longo, Longo Bros. Fruit Markets; Pete Luckett of Pete's Frootique; Dave Powell, Powell's Supermarket Ltd.; and Mark Vickars of Choices Market. The association also announced that Bill Dunne, president of Acosta Canada has been elected to its Associate Member's Council. Source: Canadian Grocer E-Newsletter, December 11, 2006.

Coca-Cola Appoints COO
The Coca-Cola Co. has named Muhtar Kent its president and chief operating officer, filling a role that has been vacant since 2004. Kent, formerly the president of the company's international operations, will now oversee all of Coca-Cola's worldwide units. Alexander Douglas of the North American unit will report to Kent. Source: Canadian Grocer E-Newsletter, December 11, 2006.

Wal-Mart Sets its Sights on India
India appears to be the next frontier for retail giant Wal-Mart Stores Inc. as the company unveils plans to open hundreds of stores to grab its share of India's estimated $250 billion retail market. Wal-Mart has joined forces with Indian telecommunications firm Bharti Enterprises to help it get past restrictions in place that hinder foreign companies from setting up retail chains. Although financial terms of its arrangement with Bharti have not been revealed it is expected that the stores in India will be set up under franchise agreements. According to reports, the first stores are expected to appear in August 2007. Wal-Mart's foray into India—one of the world's fastest-growing retail markets and still largely dominated by "mom and pop" operations—follows disastrous stints in Germany and South Korea. Source: Canadian Grocer E-Newsletter, December 1, 2006.

Maple Leaf to Shed Animal Feed Business
Maple Leaf Foods Inc. has enlisted the help of a financial advisor to assist in the sale of its Maple Leaf Animal Nutrition and related businesses. The company announced plans to shed the business in October as it turns its focus to the value added meats and meals markets. Maple Leaf said it plans to keep only those feed mills necessary to service its own hog production operations in Western Canada. The process of selling the unit, which is Canada’s largest feed business, is expected to start in January. Source: Canadian Grocer E-Newsletter, December 1, 2006.

Couche-Tard Posts 35% Profit Jump
Higher margins on gasoline sales as well as the expansion of its U.S. network helped Alimentation Couche-Tard's second-quarter profit jump 35% to US$74.7 million. Quebec-based Couche-Tard—North America's third-largest convenience store operator—said revenue during the Q2 period ending October 15, climbed 15.4% to US$2.76 billion, compared to US$2.39 billion a year ago. During the second-quarter Couche-Tard added 157 c-stores to its network, while shuttering 67. Source: Canadian Grocer E-Newsletter, November 24, 2006.

Sobeys to Build New Distribution Centre Near Toronto
Sobeys Inc. has announced plans to build a state-of-the-art grocery distribution centre in Vaughn, Ont.—north of Toronto. The Nova Scotia-based retailer says the new facility—which is expected to be fully operational in 2009—to significantly increase its warehouse and distribution capacity, while reducing costs. Sobeys also said "a significant number" of jobs at its Whitby and Milton (both in the Greater Toronto Area) distribution centres could be eliminated by 2009. Source: Canadian Grocer E-Newsletter, November 24, 2006.

Higher Sales Boost George Weston's Q3
Canadian food processing and distributing giant, George Weston Ltd. says its third-quarter net income rose nearly 15% to $226 million, helped by higher sales during the period. Toronto-based Weston, which owns 63% of Loblaw Cos. Ltd., said sales were up 4% reaching $10.9 billion during the third-quarter ending October 7, up from $9.69 billion a year ago. Source: Canadian Grocer E-Newsletter, November 24, 2006.

Golden Pencil Winners Honoured
Anthony Longo of Longo Bros. Fruit Markets and Christi Strauss of General Mills Canada were honoured as the 2006 recipients of the Golden Pencil Award at a ceremony in Toronto on November 20. Celebrating its 50th anniversary, the Golden Pencil Award recognizes those who have made an outstanding contribution to the Canadian food industry. Source: Canadian Grocer E-Newsletter, November 24. 2006.

Profits Climb 15% at Shoppers Drug Mart
Higher sales helped Shoppers Drug Mart post a 15.1% earnings jump to $124 million in its third quarter, compared to $108 million a year ago. The Toronto-based drugstore chain said the continued rollout of its larger-format stores and the addition of more high-end products to its offering helped it achieve sales of $2.32 billion in Q3, an increase of 8.9%. Shoppers also said that prescription sales were up 9.7%, while front store sales jumped 8.3%. The retailer also enjoyed same-store sales of 6.6% during the quarter ended October 7, 2006. Source: Canadian Grocer E-Newsletter, November 15, 2006.

Earnings Up at Saputo
Strong sales in Canada helped dairy giant Saputo's profit increase 5.6% to $58.3 million, despite a weaker performance in the United States in its second quarter. The Montreal-based company also reported that revenues had slipped to $994 million, from $1.03 billion. The revenue drop was attributed to a decline in U.S. sales volumes, a stronger Canadian dollar and lower cheese prices. Saputo said that while its Canadian and other revenues increased by $23.9 million, its U.S. dairy products unit saw revenues drop by $66.5 million, compared to last year. Source: Canadian Grocer E-Newsletter, November 15, 2006.

Sobeys Debuts Reusable Shopping Bag
Sobeys is the latest retailer to launch a reusable grocery bag in an effort to "divert plastic bags from the waste stream". The Nova Scotia-based retailer's "Green Bag for Life" is available to customers for $1.99 and is guaranteed for life; in the event that the recyclable bag does wear out, Sobeys says consumers can return it for a free replacement. The bag, which holds up to 20 kilograms of groceries is available at Sobeys, IGA, Foodland and Price Chopper outlets across the country—with the exception of Quebec, where a reusable bag program already exists. Source: Canadian Grocer E-Newsletter, November 15, 2006.

Wal-Mart Canada unveils grocery force to be reckoned with; 17 Supercentres planned by end of '07
Wal-Mart Canada Corp. will have up to 17 of its giant hybrid grocery stores open by the end of next year, executives said at a preview of a Supercentre in Stouffville, north of Toronto. Three of the megastores, which combine a traditional Wal-Mart with an enhanced discount grocery store, [had] their grand opening in Ontario [Nov. 8]. Fresh food is a lightning rod in Canada's grocery war. Early customers will likely be most intrigued by the retailer's selection of groceries, and Wal-Mart will take full advantage of their curiosity, [with] a number of limited time promotions on popular items. Other packaged goods are priced at or below the regular prices of discount grocery chains such as No Frills or Price Chopper. But unlike those stores, the Supercentre has a fairly broad lineup of organic and natural foods, higher-end products, and three fresh food departments with staffed counters: ready-to-go meals, a deli and a bakery. Source: National Post, Lana Holmes & Associates Ltd. with Tim Carter & Associates Inc. - 11/07/06

Food chain wraps up RFID pilot
A few weeks after completing its first RFID [radio frequency identification] pilot, Loblaw Companies Ltd. announced that the preliminary results have already helped the retailer identify ways to improve the flow of product into its stores. Still, Loblaw said it has no immediate plans to roll out any type of tagging requirement or mandate to its suppliers, acknowledging that deploying the technology is no simple task. Source: RFID Journal, Lana Holmes & Associates Ltd. with Tim Carter & Associates Inc.- 11/10/06

Loblaw pledges to respect heritage of Maple Leaf Gardens
Loblaw Companies Limited purchased the Gardens in 2004 and plans are underway to [transform it into] a flagship grocery store. "Through design and heritage interpretation, Loblaw is working with the community to ensure that the architectural and construction elements of Maple Leaf Gardens will be preserved and enhanced and the story of Maple Leaf Gardens will be told in downtown Toronto" said David Crombie, former Mayor of Toronto and currently President and CEO of the Canadian Urban Institute. Source: CNW Group, Lana Holmes & Associates Ltd. with Tim Carter & Associates Inc. - 11/10/06

Safeway rumoured to be takeover target
Speculation circulated [Nov. 9] on Wall Street that Safeway Inc. may be a takeover target for Sears Holdings Corp., the parent of the Sears and Kmart department store chains. Analysts said the deal could be worth $20 billion. Officials from Safeway and Sears declined to comment on the report that investment research firm Briefing.com published [Nov. 8]. Source: Topix.net - Lana Holmes & Associates Ltd. with Tim Carter & Associates Inc. 11/10/06

Wal-Mart Canada Mulls Banking
Banking is the latest business that Wal-Mart Canada Inc. is considering expanding into as the grocery wars heat up with the opening of Wal-Mart's Supercentres earlier this month. According to a report in the National Post, Wal-Mart Canada recently hired Trudy Fahie—formerly of American Express Canada—to assess the company's options in the banking sector. Wal-Mart spokesperson Andrew Pelletier was quoted saying that in the next six months the company will explore a range of possible financial services it may offer its customers. The company has not, however, applied to become a bank as Canadian Tire Corp. has done. In the United States, regulatory barriers have hampered the retail giant's attempts too make inroads in banking. Source: Canadian Grocer E-Newsletter, October 31, 2006.

Wal-Mart Eyes Downtown Toronto
Wal-Mart developer Mitch Goldhar has acquired a 50% stake in a downtown Toronto site raising speculation that the city may soon be getting its first downtown big box. According to a report in the Toronto Star, Goldhar's SmartCentres Inc.—the largest developer of power centres in Canada—paid $14 million for its share of the property, the current home of the Toronto Film Studios. According to the report, Goldhar said he purchased the property as a potential site for a centre, but that there were no immediate plans to build. Source: Canadian Grocer E-Newsletter October 31, 2006.

Calloway Pays $1 Billion for Wal-Mart Anchored Malls
Calloway Real Estate Investment Fund has agreed to pay $1 billion to buy 16 shopping centre properties from privately owned SmartCentres, run by developer Mitch Goldhar. The deal includes nine existing shopping centres and seven still being developed. Wal-Mart stores anchor most of the properties, and about half of the sites are located in the Toronto area, while the others are in New Brunswick, Quebec and other Ontario locations. After the deal is wrapped up, in December, Calloway will own five of the locations occupied by Wal-Mart supercentres in Canada. Source: Canadian Grocer E-Newsletter, October 31, 2006.

Wal-Mart Supercentres Arrive
The battle for the fresh food dollar is heating up in Ontario with the much-anticipated debut of two Wal-Mart Supercentres in the province. The outlets, located in London, Ont., and Ancaster, Ont. (near Hamilton) sport a "Your Fresh Market" banner, an indication of the expanded food offering inside, which includes fresh food including natural and organic products, an in-house bakery, deli and take-out food area. The two outlets are expansions of existing Wal-Mart outlets, but the retailer has plans to open a brand new Your Fresh Market site in Stouffville, Ont. next month. Source: Canadian Grocer E-Newsletter, October 24, 2006.

Heinz Buys Renée's Gourmet
Heinz Canada has purchased salad dressing maker Renée's Gourmet for an undisclosed amount. Toronto-based Renée's, Canada's largest maker of refrigerated salad dressings, will add about $60 million in annual sales to Heinz. Heinz intends to retain the Renée's name and according to a report in the Globe and Mail , Renée Unger, founder and former president of the company, will remain as a consultant at the company, while ex-husband Arnie, former CEO, will leave the company at the end of the month. Source: Canadian Grocer E-Newsletter, October 24, 2006.

Pareto Buys Secom Plus
Toronto-based marketing services company, Pareto Corporation says it has purchased Montreal-based Secom Plus, a retail sales and merchandising company. Although terms of the deal were undisclosed, Pareto says the acquisition of Secom Plus—a firm with a client list that includes major retail and packaged companies such as L'Oreal, Bayer, Metro and Shoppers Drug Mart—is expected to generate "in excess of" $10 million in revenues next year. According to a release Secom Plus will continue to be managed by its founders Louis Demers and Johanne Jetté. http://www.pareto.ca/investor/ Source: Canadian Grocer E-Newsletter, October 10, 2006.

Couche-Tard Expands Again
Again Quebec-based convenience store operator Alimentation Couche-Tard is expanding its U.S. network once again, with the purchase of 236 stores and gas stations in four states. Although the price of the purchase from Shell Oil Products U.S. was not disclosed, analysts estimate the acquisition will generate about $900 million in motor fuel and merchandise revenues for Couche-Tard. Couche-Tard is the second-largest c-store operator in North America with a network of some 5,200 stores. Quebec-based convenience store operator Alimentation Couche-Tard is expanding its U.S. network once again, with the purchase of 236 stores and gas stations in four states. Although the price of the purchase from Shell Oil Products U.S. was not disclosed, analysts estimate the acquisition will generate about $900 million in motor fuel and merchandise revenues for Couche-Tard. Couche-Tard is the second-largest c-store operator in North America with a network of some 5,200 stores. Source: Canadian Grocer E-Newsletter, October 10, 2006.

Changes at Coca-Cola Bottling Co.
The Coca-Cola Bottling company has promoted Alain Robichaud to the role of vice-president, sales operations. Robichaud previously held the position of market unit vice-president, Quebec/Atlantic. In addition, David Moore has been named the company's vice-president, national home market sales; Desmond White is now vice-president, immediate consumption channels; and Christina Smith is director, government and industry relations. Source: Canadian Grocer E-Newsletter, October 10, 2006.

Loblaw and Wal-Mart "Cheap Chic" Push
With Loblaw and Wal-Mart stepping up promotion of their Joe Fresh and George clothing lines respectively, fashion is emerging as the latest category for these retailers to do battle. According to a report in the Toronto Star, both retailers are fixed on grabbing a bigger slice of the $18.7 billion Canadian apparel market with their "cheap chic" (high fashion at low prices) offerings. To make its Joe Fresh label more accessible (outside of its Real Canadian Superstores), Loblaw just announced the launch of two Joe Fresh Style "Studio" stores—replacing the former Caban stores—in Toronto. Wal-Mart, meanwhile, is expanding its edgy George line, to 272 of its outlets (from about 150 currently) by next year. Source: Canadian Grocer E-Newsletter, September 29, 2006.

German food retailer separates scanning and payment to speed up checkout
This summer, German-based retail giant The Metro Group, started quietly experimenting with a radical change in supermarket layout and procedure: physically separating where groceries get scanned and where customers make their payments. The move is designed to both cut costs and accelerate customers through the checkout process said Gerd Wolfram, the group's chief technology officer and the managing director of Metro Group Information Technology. Metro Group offers both self-checkout and cashier checkout. "The customer comes to the scanning area, then we - as a service - scan the things or the customer scans the things," he said. "The customer receives the bar code ticket for his goods, and he goes to a payment machine. If he pays cash, he can just throw in the coins." Beyond speed and cost-savings, Wolfram said the chain is hoping the new system will be seen as improving payment privacy "because there is nobody looking over their shoulder." Source: eWeek.com - 09/13/06 Prepared by: Lana Holmes & Associates Ltd.with Tim Carter & Associates Inc.

Canadian Tire Steps Up Plans for Larger Stores
Encouraged by strong sales, Toronto-based Canadian Tire Corp. says it plans to step up the rollout of its larger-format outlets. Speaking at a retail conference, Canadian Tire CFO Huw Thomas said his company plans to have 300 stores conforming to its larger Concept 20/20 store model by 2009—about a $900 million investment. The Concept 20/20 stores—which the company says are more popular with shoppers—range from 65,000 to 100,000 square-feet. About 200 existing stores will be retrofitted and the remainder will be new stores in both suburban power centres as well as more "inner city" development. Source: Canadian Grocer E-Newsletter, September 22nd. 2006.

Shoppers Unveils Big Plans
Shoppers Drug Mart Corp. says plans are in the works to open up to 300 big box stores over the next five years. Toronto-based Shoppers has been focused on enlarging its outlets over the last four years and the new stores are expected to be between 10,000 to 12,000 square feet, significantly larger than the chain's current store average of 8,300 square feet. Speaking at a conference recently, Shoppers chief Glenn Murphy said the company would continue expanding its high-end cosmetics department, introduce digital photo processing units to its stores and re-launch its Optimum loyalty card. The company has also started introducing new pharmacy services to help fend off competition from other retailers such as grocers. Source: Canadian Grocer E-Newsletter, September 22nd. 2006

Sobeys to Convert Ontario IGA Outlets
Under a new corporate restructuring plan, Sobeys Inc. is about to convert most IGA outlets in Ontario to either the Sobeys, Foodland or Price Chopper banners. According to a CBC report, citing a confidential letter from Sobeys to Ontario IGA franchisees, Sobeys is offering to buy out any of the IGA independent franchisees that do not wish to convert their stores. Reports say Sobeys is planning to see all of its stores fall into one of five formats: full service (Sobeys), community service (Foodland), fresh service (Sobeys), price service (Price Chopper) or convenience (Sobeys Express). The conversions are to take place over the next few months. IGA's advisory committee says its lawyers are reviewing the situation and will monitor to ensure Sobeys respects its contractual obligations under the IGA franchise agreements. Source: Canadian Grocer E-Newsletter, September 8, 2006.

Coca-Cola Looks to Coffee and Tea to Heat Up Sales
With the fizz gone out of soda sales, Coca-Cola is setting its sights on the hot beverage market with its debut of a new line of coffees and teas. Canada will be the test market for Coke's new Far Coast hot beverage brand (coffee, tea, lattes, espressos), which will be available to restaurants and hotels. The company has also introduced Chaqwa, a brand of coffees and teas available at fast food outlets and convenience stores and aimed at on-the-go consumers. The introductions follow the recent launch of Coke's Coca-Cola Blãk, a coffee-flavoured cola, to the Canadian market. Coke's foray into hot beverages comes at a time when sales of soft drinks are slumping and specialty coffees and teas among the fastest-growing categories. Source: Canadian Grocer E-Newsletter, September 8, 2006.

Food and Beverage Store Sales up 2%
Food and Beverage store sales went up by 2.0% in the first half of 2006 compared to last year. In its national survey of retail sales released last month, J.C. Williams research and consulting firm of Toronto reported that by June 2006 food and beverage store sales had risen to $7.7 billion compared to $7.4 billion in 2005. Retail sales, including automotive, were $185 billion compared to $173 billion last year (+7.0%). Pharmacies and personal care store sales soared by 10.7% (from $11.4 billion to $12.7 billion. The highest increase (11.7%) was registered by the building and outdoor home supplies as the sector sales increased from $10.6 billion to $11.9 billion. Source: Canadian Grocer E-Newsletter, August 25, 2006

Management Buyout at Groupe Danone's Canadian Bottled H20 Business
Birch Hill Equity Partners Inc., a private-equity company spun from Toronto-Dominion Bank, has backed a management buyout of Groupe Danone's Canadian bottled-water business, reports Financial Post. Terms were not disclosed. The company, which produces water under the Canadian Springs and Labrador Source brands, will be named Aquaterra Corp. and run by veteran bottled water executive Richard Stephens. Source: Canadian Grocer E-Newsletter, August 25, 2006.

Florida Shopping Spree for Couche-Tard
Laval, Que.-based Couche-Tard convenience store chain has announced that it would purchase 24 c-stores in west-central Florida from Sparky's Oil Co. and 54 Ohio c-stores from Holland Oil Co. The acquisition will increase the company's Florida network to 570 stores and add about US$84 million in sales in that state. Seven of the new Couche-Tard stores have drive-through car washes and 17 have quick-service restaurants. All 24 stores will be converted to the Circle K banner. The stores are on highly visible and well-travelled roads, according to Mick Parker, Couche-Tard's Florida-Gulf division vice-president of operations. The Ohio acquisition—all company owned and selling gas—will make the Quebec company the biggest player in the Cleveland area. Analysts believe Couche-Tard will make more acquisitions in southeaster and southwestern United States. With 5,000 c-stores, the company is already the second-largest independent c-store operator in North America. Source: Canadian Grocer E-Newsletter, August 25, 2006.

A&P Acquisition Fuels Metro Profit
Metro Inc.'s third-quarter profit zoomed 50% after the Montreal-based supermarket chain digested its $1.7 billion purchase of A&P last year. In its August 10th report the company said it earned $85.1 million, or 73 cents a share. That is up from a year earlier profit of $56.9 million, or 58 cents a share. Sales jumped 76% to $3.34 billion from $1.9 billion as Metro added A&P Canada's 236 Dominion and A&P stores to its network. Excluding the A&P acquisition, third-quarter sales were up 2.9%. The company said it realized $15.5 million in synergies in the third quarter and is confident it would exceed its target of $35 million for the first year following the acquisition. Source: Canadian Grocer E-Newsletter, August 25, 2006.

Wal-Mart Canada Advises Suppliers on Price
Wal-Mart Canada Corp. has advised its suppliers to explore new ways to lower prices. In a letter signed by Mike Huffaker, chief merchandising officer, and Jim Thompson, senior vice-president, merchandising, Canada's biggest retailer said that the Canadian dollar is "trading at near-historic highs, providing unanticipated inflation of profit margins" among the company's suppliers. Wal-Mart said the healthy Canadian dollar is an "opportunity to lower prices for Canadians." One money-saving tip in the internal letter is for suppliers of package goods being sold in Canada and the United States to do so in English, French and Spanish, erasing the cost of separate packaging print runs. Source: Canadian Grocer E-Newsletter, August 25, 2006.

Jean Coutu Group To Sell U.S. Drugstores
Longueuil, Que.-based Jean Coutu Group Inc. will sell its United States drugstore chains Eckerd and Brooks to Rite Aid Corp national drugstore group for US$1.45 billion in cash, stock and $850 assumed debt. As a result of the transaction, Jean Coutu Group will have a 32% stake in the U.S. chain, making it the biggest stockholder. Two years ago the Quebec company paid about US$2.4 billion for 1,549 Eckerd stores and has faced challenges in integrating them. The company now has 1,521 Eckerd stores, 337 Brooks stores, in addition to six distribution centres, mainly on the East Coast. "We see this transaction as a unique strategic opportunity to optimize our U.S. presence by transforming our investment in a regional drugstore chain into the leading ownership position in a major national chain with the scale to better compete in the growing U.S. drugstore industry," said Jean Coutu, chairman and CEO of Jean Coutu Group. Source: Canadian Grocer E-Newsletter, August 25, 2006.

Strong Q2 for E.D. Smith
Revenue growth, spurred by acquisitions, helped E.D. Smith Income Fund earn a profit of $4.6 million in its second quarter. The Winona, Ont.-based maker of jams, jellies and other food products said its revenues were up 11% in the quarter, reaching $58.3 million. The company, which became an income trust last year, said acquisitions of Seaforth Creamery and the grocery products division of Golden Valley Foods as well as revamped product packaging, contributed to its strong performance during the quarter. Source: Canadian Grocer E-Newsletter, August 19,2006.

PepsiCo Names First Woman CEO
Indra Nooyi will assume the top position at global beverage giant PepsiCo Inc., in October. Nooyi joined PepsiCo in 1994 and has served as its chief financial officer since 2001. Nooyi will be the first woman to lead the company. Source: Canadian Grocer E-Newsletter, August 19,2006.

Wal-Mart wins B.C. union ruling
Wal-Mart Canada Corp. says the British Columbia Labour Relations Board has ruled in favour of Wal-Mart in a case involving attempts by the United Food and Commercial Workers Union to unionize 10 workers in the auto department of a B.C. Wal-Mart store. The union attempted to unionize the Tire Lube Express Department workers in a Surrey West store "after losing several store-wide votes of Wal-Mart workers in various locations across Canada," Wal-Mart said. It said the latest decision follows a similar ruling by the board last month that dismissed the union's application to carve out 10 auto-department workers from a Wal-Mart store in Cranbrook, B.C. Wal-Mart said it believes the "carving out of a very small group of select workers from the total team of a! ssociates in a store environment is unrepresentative and undemocratic." Source: National Post/CFIG E-News, August 14, 2006.

Metro's A&P takeover factors positively into Q3 results
Metro Inc.'s third-quarter profit increased nearly 50 per cent to $85.1 million, thanks in large part to its 2005 acquisition of A&P Canada. Sales also increased 75.8 per cent to more than $3.33 billion in the quarter, compared to $1.9 billion last year in the same period, the Quebec-based grocer reported. [Including A&P Canada stores, third quarter same-store sales rose 0.8%.] President and CEO Pierre Lessard said Metro will continue to invest in its retail network in both Ontario and Quebec, noting 46 stores have been renovated or expanded and 16 new stores have been opened over the year. He said the arrival of Wal-Mart superstores in Ontario that sell food shouldn't hurt Metro, adding Metro has discount grocer Food Basics in that province. Source: Canada.com/CFIG E-News, August 14, 2006.

Sobeys makes move into Quebec
Sobeys Inc. announced [August 9] it will buy the distribution assets of Quebec-based Achille de la Chevrotiere and its associated companies ADL. The company will pay $82 million and will close the deal during the second quarter, pending regulatory approval, it said. Included in the purchase are 25 retail stores, other wholesale supply agreements and distribution facilities. Sobeys said the aggregate annual sales from the assets it has purchased were $270 million. The Sobeys name will not be placed on the newly purchased stores. IGA, IGA Extra, Marche Bonichoix banners will go up. Source: Halifax Daily News/CFIG E-News, August 14, 2006.

Wal-Mart food format begins southern Ontario invasion
Wal-Mart is Canada's single largest non-food retailer with an estimated $13 billion a year in sales. It's [now] preparing to take on the supermarket industry in a battle for control of Canada's $70 billion a year grocery business. By this time next year the Scarborough store [Warden and Eglinton, Toronto] will be one of seven Wal-Marts - all in Ontario - that will carry everything from lettuce to chicken legs. The U.S. based retailer has confirmed that it will open three of these behemoths this fall, one each in Ancaster, London, and Stouffville. The other three schedule! d to open early next year are in Vaughan, Brampton, and Sarnia. Wal-Mart has been gradually adding more food to its stores. But until recently it was confined to dried goods, frozen foods and dairy products. Customers had to go elsewhere to buy fresh meat, produce or baked goods. Source: Toronto Star/CFIG E-News, August 14, 2006.

SunOpta Unveils Plan for Ethanol Plant
A Brampton, Ont.-based distributor of natural, organic and specialty foods has set its sights on building the first commercial plant for producing ethanol from biomass. According to a report in the Toronto Star, the company has ambitions to become a major producer of "cellulosic" ethanol made from wheat straw and wood waste and will open a five-million litre a year commercial demonstration plant in Spain later this year. As the market for biofuels heats up—Canada, for instance, is expected to mandate that gasoline contain at least 5% ethanol by 2010—a number of companies are racing to build commercial ethanol plants. www.sunopta.com Source: Canadian Grocer E-Newsletter, August 11, 2006.

Coutu to Revamp U.S. Stores
Quebec-based Jean Coutu Group Inc. says it will spend US$250 upgrading its U.S. network of stores. Coutu—North America's fourth-largest drugstore chain—says plans are in the works to revamp about 800 of its Eckerd and Brooks stores to make them more competitive. Digital photo processing kiosks will also be added to many of the stores. Coutu has been struggling to integrate the stores since it purchased the Eckerd chain for $2.4 billion in 2004. The unveiling of the plan followed the company's announcement that its fourth-quarter profit fell 34%, a result of rising interest and administrative costs. Source: Canadian Grocer E-Newsletter, August 11, 2006.

Grocers Won't Face Charges Over Sunday Shopping
Crown prosecutors and police in Nova Scotia say they will not lay charges against Loblaw-owned Atlantic Superstore and Sobeys over alleged violations to the province's Sunday shopping ban. Although the N.S. government recently introduced new rules to clamp down on large retailers using a loophole to skirt the ban, Halifax police said they are satisfied that the current openings are within the law. Crown prosecutors agree with the decision to not lay charges. Source: Canadian Grocer E-Newsletter, August 11, 2006.

Sobeys to Buy Achille de la Chevrotière
Sobeys Inc. has agreed to pay $82 million to acquire the food distribution assets of Quebec-based Achille de la Chevrotière Ltèe. The transaction will see Stellarton, N.S.-based Sobeys gain 25 retail stores in Quebec and Northern Ontario as well as a distribution centre in Rouyn-Noranda, Que. Sobeys is expected to operate the stores, which generate about $270 million in annual sales, under either its IGA or IGA Extra banner. Sobeys said it expects to complete the deal, which is subject to regulatory approval, in its second quarter. Source: Canadian Grocer E-Newsletter, August 11, 2006.

Metro's Profit Jumps 50%
Higher sales following its acquisition of A&P Canada a year ago helped Metro Inc. boost its profit by nearly 50%. Montreal-based Metro says it earned $85.1 million in the third-quarter ending July 1, 2006, compared to earnings of $56.9 million a year ago. Excluding non-recurring items such as integration and rationalization costs of $3.9 million and a tax gain of $9.4 million, Metro said adjusted net earnings would have been $78.3 million. The retailer also reported a 75.8% rise in sales to $3.3 billion. Source: Canadian Grocer E-Newsletter, August 11, 2006.

Whole Foods Considers Tweaking Prices
With sales falling short of analysts' forecasts, Whole Foods Market is considering lowering its prices on certain items to be more competitive with other food retailers. The Austin, Tex.-based company--which operates 180 outlets in the United States, Canada and the United Kingdom--known for charging higher prices than other food stores, said it is rethinking its pricing of products that can be found in other stores such as branded organic and natural foods. The retailer reported sales of US$1.34 billion for its third quarter, up from US$1.13 billion a year ago. Although Whole Foods posted an 18% rise in sales, analysts are worried that consumers being pinched at the gas pumps will cut back spending on higher-end foods. Whole Foods has set a goal of US$12 billion in annual sales by 2010. Source: Canadian Grocer E-Newsletter, August 5, 2006.

General Mills President from Down Under
Dave Homer is the new president at General Mills Canada, succeeding Christi Strauss. Homer was managing director of Australasia, responsible for Australia and New Zealand. Source: Canadian Grocer E-Newsletter, August 5, 2006.

New Chief at Shoppers Drug Mart
Jurgen Schreiber has been named the new president and chief operating officer at Shoppers Drug Mart. Schrieber is a former executive with Hutchison Whampoa's A.S. Watson unit, one of the world's largest health and beauty retailers. Schreiber will assume his new position in September. Source: Canadian Grocer E-Newsletter, August 5,2006.

New Rules Protect N.S. Retail Workers
Grocery retailers in Nova Scotia operating outlets greater than 4,000 square feet must offer staff the right to refuse to work on Sundays and holidays, according to a new rules introduced by the provincial government. The government—which has been attempting to clamp down on grocery chains using a legal loophole to skirt a Sunday shopping ban—says the new rules apply to related grocery business operating in the same building or in close proximity. The government's labour minister said the changes would protect retail workers who have not historically had to work on Sundays as well as businesses being forced to open on Sundays by their landlords. Canadian Grocer E-Newsletter, July 29, 2006.

Kraft Partners with Meal-Assembly Chain
U.S.-based Kraft Foods Inc. has announced plans to collaborate with Dinner by Design, a leader in the home meal assembly business. Under the agreement Kraft, through its North American foodservice unit, will lend a variety of its brands—including A.1 steak sauce, Oreo cookies and Stove Top stuffing—to Dinner by Design for use in the chain's entrees. Meal assembly is the latest trend in the food industry, allowing busy consumers to save time, stress and mess by using prepared ingredients and recipes provided by meal-assembly outlets to quickly create a home-cooked meal. Kraft says helping time-pressed consumers live and eat better by offering added convenience is a key strategy of the company. Source: Canadian Grocer E-Newsletter, July 29, 2006.

Wal-Mart Exits Germany
Wal-Mart Stores Inc. has announced it is pulling out of Germany, selling its 85 supercentres to rival Metro Group. Explaining the move, the retail giant said that in the German marketplace it "would be difficult to obtain the scale and results we desire." Wal-Mart had experienced a number of difficulties during its eight-year stint in Germany including trouble securing prime real estate and a misunderstanding of German tastes and shopping habits, which contributed to a lack of profitability for the unit. Although terms of the deal were undisclosed, it is reported Wal-Mart will take a $1-billion pre tax loss on the sale. Source: Canadian Grocer E-Newsletter, July 29, 2006.

Golden Pencil Winners Named
Anthony Longo, president and CEO of Longo Brothers Fruit Markets, and Christi Strauss, former president of General Mills Canada and now CEO, Cereal Partners Worldwide in Switzerland, will receive the Golden Pencil award this year. This marks the 50th year of the Golden Pencil—the Canadian food industry's highest honour. Source: Canadian Grocer E-Newsletter, July 29,2006.

Key Fall Events to Mark on your Calendar
October 23-24: Grocery Innovations Canada 2006, Toronto Congress Centre, Toronto. Visit www.cfig.ca. October 29-November 2: Pack Expo International 2006, McCormick Place, Chicago. Visit www.packexpo.com. Source: Canadian Grocer E-Newsletter, July 21, 2006.

Profits Climb 18% at Shoppers Drug Mart
Strong second-quarter sales across the country helped Shoppers Drug Mart Corp. boost its profit by 18% to $94 million. The Toronto-based retailer said the 8.9% jump in sales during the Q2 period ending June 17, was helped by an increase in prescription drug sales. Sales reached $1.77 billion from $1.62 billion a year ago and same store sales increased 7%. Commenting on the chain's performance, chairman and chief exec Glenn Murphy said: "In the back half of the year we will focus on executing our real estate plan, strengthening our mix and improving operating leverage." Source: Canadian Grocer E-Newsletter, July 21, 2006.

Executive Moves
Sobeys Exec Moves to Canadian Tire Duncan Reith is now senior vice-president, Canadian Tire Retail. Reith was previously chief merchandising officer at Sobeys Inc. New VP at McCain Darryl Rowe is the new vice-president of retail sales at McCain Foods Canada. Rowe was previously vice-president and general manager, retail business unit, at Coca-Cola Beverages Ltd. New Chief at Kellogg Canada Francois Rouilly is the new president and chief executive officer of Kellogg Canada. Rouilly is responsible for all Canadian operations including the Kellogg manufacturing plant in London, Ont. Source: Canadian Grocer E-Newsletter, July 21, 2006.

Vancouver versus the Big Box
The debate over big boxes continues in Vancouver with city council reconsidering whether it will allow big boxes such as Wal-Mart and Canadian Tire to set up shop within city limits. Last summer, city council rejected proposals from the two retailers to build stores on industrial land near the city's Marine Drive—an area where at one time it was permissible to build bigger outlets. Now, the city is revisiting its policy to determine which of three courses to take: to accept new applications from these retailers under its highway-oriented retail policy or ban big boxes altogether or impose conditions that would limit big boxes to "occasional purchase" stores such as furniture and carpet outlets—not, however, general merchandise retailers such as Wal-Mart. Source: Canadian Grocer E-Newsletter, July 11, 2006.

Food industry gets a taste of RFID's potential
A cabal of Canadian food companies have agreed to share their findings as they embark on a joint RFID pilot project, scheduled to begin later this month. The pilot is the work of the Canadian RFID Centre, which first opened its doors last year at an IBM Canada facility in Markham, Ont., as well as retailers, suppliers and food industry organizations. The marquee names include Loblaw Companies Ltd., Maple Leaf Foods, General Mills Canada, Scott Paper and Unilever Canada. Loblaw's is offering up its distribution centres and stores as a test bed for the six-month pilot; the other participants will mark a small selection of their inventory with RFID tags to measure the effectiveness of using the technology in a grocery store supply chain. RFID (radio frequency identification) is beginning to come into its own as a retail technology. The tags are being used at the case and pallet level to track retail items through the supply chain. For the food industry, that could mean less spoilage and more efficient delivery. This pilot is one among many currently underway in Canada and around the world, but is more collaborative than most, said Shai Verma, RFID practice leader for IBM Canada’s business consulting services. “One of the objectives is to show how RFID can be implemented where not only the retailers see benefit – it’s been shown that the retailers can see a lot – but also where the manufacturers can see some benefit,” said Verma. “That’s a different approach that’s been seen in some different geographies, like Wal-Mart for example or other retailers in the States. “For manufacturers, it’s not a slam dunk that the ROI for RFID adoption is positive.” For that reason, the participants are trialing the technology on a very limited basis. Bill Langlois, director of customer service for Toronto-based Unilever Canada, said his company is testing tags on two of its dry-food products. Unilever has participated in other RFID pilots globally (it maintains dual headquarters in the U.K. and the Netherlands) but the attraction of this pilot is the number of companies that have agreed to participate openly. “Because it’s collaborative by nature, it could be used as something on a go-forward basis, if and when RFID becomes mainstream,” said Langlois. “The intent of this is really assessment and to develop a business case for the industry as a whole.” The pilot will also examine the feasibility of testing fresh and frozen foods with RFID tags, which is a relatively new area for RFID supply chain projects, said Verma. Some of the pilot’s participants wanted to start with those food categories, he added, because they have “not necessarily been well addressed in the RFID space” to date. The reason for the beta is to conduct a rigorous examination of RFID in the grocery business, said Elaine Smith, senior vice-president of industry affairs for Food and Consumer Products of Canada, one of the industry organizations that is providing oversight for the project. “It’s not a cheap thing to do,” she said. “If you don’t get the cost benefit out of it and you aren’t able to better serve consumers by reducing out-of-stocks, why bother? I think eventually, there will be a time where RFID will be prevalent in the supply chain, but it might take some time to get there.” Other pilot participants include the Canadian Council of Grocery Distributors, EPCglobal Canada, Intermec Inc. and Symbol Technologies. Source: itbusiness.ca Canadian Technology News July 11, 2006.

It's Grocery Innovation Time Again this Fall
The 7th edition of Grocery Innovations Canada 2006 is recognized as a critical business booster for the grocery industry. With over 500 exhibits comprised of grocery products from national brand, imported and Canadian food processors as well as the newest store equipment and services, Grocery Innovations Canada is a microcosm of supermarket trends. The event is considered a must-attend by key industry players and attracts more than 6,000 industry attendees. Grocery Innovations Canada 2006 is presented by the Canadian Federation of Independent Grocers (CFIG); in association with the Food and Consumer Products of Canada (FCPC); the Canadian Association of Sales and Marketing Agencies (CASMA) and GS1 Canada, with support from Agriculture and Agri-Food Canada and Canadian Grocer. The organizations represent the strength, innovations and leadership behind Canada's $70.1 billion grocery industry. DATES: October 23 & 24, 2006 LOCATION: Toronto Congress Centre, 650 Dixon Road, Toronto, ON, Canada M9W 1J1 NUMBER OF EXHIBITS: 500+ NUMBER OF ATTENDEES: More than 6,000 industry attendees TRADE SHOW HOURS: 11:00 AM - 5:00 PM CONFERENCE HOURS: 7:15 AM - 11:00 AM REGISTRATION HOURS: On-site Trade Show Only Registration – including Customer Invitations - located at the Hall D Entrance Monday, October 23, 2006 11:00 am – 5:00 pm Tuesday, October 24, 2006 11:00 am – 3:30 pm Pre-Registration Badge Pick-Up located in the E. Mirvish Room Sunday, October 22, 2006 9:00 am – 5:00 pm Monday, October 23, 2006 7:00 am – 7:00 pm Tuesday, October 24, 2006 7:00 am – 7:00 pm Contact Info: Grocery Innovations Canada 2006 2235 Sheppard Avenue East, Suite 902 Willowdale, ON M2J 5B5 Tel: 416.492.2325 Toll Free: 1.800.387.0175 Fax: 416.492.2347 info@cfig.ca www.groceryinnovations.com

Manitoba facing the same labour market challenges as Alberta
Manitoba is in dire need of workers - from engineers, and company leaders to grocery store cashiers. Employers across a large swath of the provincial economy are finding it difficult to find the workers they need. Statistics Canada pegged Manitoba's June unemployment rate at 3.6 per cent, the lowest in the province's history, and just a shade higher than nation-leading Alberta's 3.5 per cent. Canada Safeway needs 300 workers right now at its 35 Manitoba stores, says a company spokesman. Small businesses are also affected by a shortage of labour. The president of the Manitoba Chambers of Commerce said a longtime concern of his organization is that the province has some of the lowest wages in the country. That, he said, doesn't bode well for its ability to attract needed workers. However, he said, government must do its part. The province must create a more favourable business climate by reforming taxation policies that now discourage job creation. Source: Winnipeg Free Press - CFIG E-News, July 10, 2006.

GST changeover goes 'smoothly'
Retailers experienced relatively few problems in adjusting to the one-per-cent cut in the Goods and Services Tax over the holiday weekend. The Canada Revenue Agency kept open its GST hotline during the Canada Day weekend, on Saturday, the day the tax cut took effect, and also on Monday. But there was no flood of calls from consumers and businesses. On Saturday, there were only 89 calls to the GST toll-free line. On Monday, there were 279 calls, according to the agency. Source: Canada.com - CFIG E-News July 10, 2006.

Independent seeks out new tastes
Starting June 1, products [from] New Zealand [such as] liquid kiwifruit, steamed puddings, handmade soups and organic hot sauces will be available at Longo's grocery stores. As well, Michael Bonacini, chef and owner of five restaurants in the [greater Toronto area], is teaming up with Longo's to produce several recipes that will be made available in-store to customers and on Longo's website. "As part of our Adventures in Food philosophy, our buyers spent considerable time researching New Zealand's food culture to determine which products will be most appreciated by our discerning customers," says Anthony Longo, president and CEO, Longo's. Source: CFIG Electronic Broadcast - Canadian Grocer May 29, 2006.

Major e-retailer moves into U.S. grocery business
Amazon.com has launched a new grocery section on its site that features some 14,000 items and the ability to get free shipping through either the company's Super Saver Shipping program or prepaid Amazon Prime program. [Amazon.com will ship anywhere in the continental United States.] The new Grocery section expands on Amazon's previous efforts to sell food online. In certain cases Amazon will be carrying entire lines of products, far more than might be carried by a supermarket - such as more than 80 varieties of Jello. This is not a third party-driven site, or a portal to another service; Amazon is selling the products online, stocking them in a warehouse, and handling all the shipping. Source: CFIG Electronic Broadcast - Canadian Grocer May 29, 2006.

Safeway to convert all North American outlets to 'lifestyle' format
Attributing its strong sales and earnings growth largely to the rollout of its 'lifestyle' stores, Safeway Inc. says it now plans to convert all of its 1,772 Canadian and U.S. outlets to the lifestyle format by the close of fiscal 2009. Safeway Inc. CEO Steve Burd made the announcement at the company's recent annual shareholder's meeting, where he said the new format stores-with expanded product categories and more upscale design - typically have sales 23% higher than other remodeled Safeway outlets. Source: CFIG Electronic Broadcast - Canadian Grocer May 29,2006.

Earnings Up At Premium Brands
Premium Brands Income Fund—producer, marketer and distributor of specialty banded consumer food products—reported that first quarter earnings climbed to $1.8 million, compared to a loss of $0.3 million during the same period last year. The Vancouver-based company—which owns brands such as Grimm's, McSweeney's and Harvest—also reported that sales during the quarter ending April 1, jumped 14.4% to $47.1 million. Source: Canadian Grocer E-Newsletter, May 19, 2006.

Strong Q1 for Connor Bros
Toronto-based fish processor Connor Bros. Income Fund said its first-quarter profit jumped 75% to US$12 million, from US$6.9 million a year ago, surpassing its expectations. The fund, which indirectly owns Clover Leaf Seafoods and Bumble Bee Foods, also said its revenues for the first quarter ending April 1, increased to US$244.1 million from US$211.7 million. Connor Bros. attributes the increase to strong volumes and savings gained from it acquisition of Castleberry's and Sweet Sue-Bryan. Source: Canadian Grocer E-Newsletter, May 19, 2006.

Canada Grabs Two SIAL D'Or Awards
Canadian products captured two of eight prestigious SIAL d'Or awards, indicating they are the best new products in the world, at the competition held recently in Paris, France. Winner in the Savory Grocery Product category was Campbell's Soup at Hand and winner in the Alcoholic Beverages category was French Rabbit, wine in Tetra Paks that has been one of the most successful new wine launches in Canadian history. Other Canadian products also did well. President's Choice Decadent Molten Chocolate Cakes came second in its category, while Burnbrae Farms' Egg Creations and Europe's Best Vegetables each scored third place in their respective categories. The SIAL d'Or award starts with nominations from the grocery trade, which is asked to submit suggestions for products that are innovative and are selling well for a specific period from launch. Canadian Grocer represents SIAL d'Or in Canada. Twenty-seven countries were involved in this year's competition. Other Canadian entries were: Stouffer's Bistro Crustini, Sun-Rype Fruit Plus Essential Nutrients and Nature Valley Sweet and Salty Nut Bars. Source: Canadian Grocer E-Newsletter, May 19, 2006.

2006 National Grocery Conference Gears Up
The 2006 National Grocery Conference—which gets underway in St. John's, Nfld,. May 27 to 29—will provide close to 1,000 food industry leaders with "outstanding" networking opportunities as well as full lineup of business sessions featuring top-rated speakers such as author Paco Underhill, Globe & Mail columnist Jeffrey Simpson and Capital C founder and CEO Tony Chapman—say conference organizers. Another highlight of the event, presented jointly by the Canadian Council of Grocery Distributors and the Food and Consumer Products of Canada, will be the Canadian Grand Prix New product Awards Gala Banquet, which will wrap up the three-day event. For more information on the conference please visit www.ccgd.ca or www.fcpc.ca. Source: Canadian Grocer E-Newsletter, April 28, 2006.

Maple Leaf Reports Higher Earnings
Canadian food processing giant Maple Leaf Foods Inc. posted earnings of $17.3 million during its first-quarter, up from $12.7 million during the same period last year. Sales for the Q1 period ending March 31, 2006, slipped 5% to $1.4 billion, from $1.5 billion a year ago; the company attributed the decline to the lower commodity prices of export products. "We made good progress in earnings recovery during our first quarter of 2006, as we addressed factors that challenged us in late 2005," said Michael H. McCain, Maple Leaf's president and CEO. "However, as expected, protein markets were weak on a number of fronts coming into this year." Source: Canadian Grocer E-Newsletter, April 28, 2006.

Profits Rise at Canada Bread
Net earnings for Canada Bread Company Limited climbed 28% to $19.4 million in its first quarter, from $15.1 million a year ago. The Toronto-based company also reported that sales for the first-quarter period ending March 31, 2006, increased 4% to $301.6 million—driven mostly by improved product mix. "We had an exceptional quarter, driven by significant growth in our higher nutrition, higher margin grain breads," said company president and CEO Richard Lan, adding that the company was continuing to offset inflationary pressures, including rising fuel and freight costs, through ongoing price increases. Source; Canadian Grocer E-Newsletter, April 28, 2006.

E.D. Smith to Buy Seaforth Creamery
E.D. Smith Income Fund, maker of jams, jellies, marinades and other food products—both branded and private label—has agreed to purchase Seaforth Creamery Inc., of Seaforth, Ont., for $95.2 million. Privately owned, family-operated Seaforth Creamery is Canada's largest producer of private-label salad dressings with annual revenues of $106 million. Winona, Ont.-based E.D. Smith said Seaforth had a strong presence in the United States and that the acquisition would provide it with "significant" cross-selling opportunities in addition to further broadening its customer base, which will include the top four food retailers in the United States. The deal is expected to wrap up in mid May. Source: Canadian Grocer E-Newsletter, April 28, 2006.

Cott Looks to Energy Drinks to Boost Sales
With the fizz gone out of pop sales in North America, Cott Corp., the world's largest maker of store-brand soft drinks, says in 2006 it will focus on increasing its presence in non-carbonated beverages, including the fast-growing energy drink segment. Toronto-based Cott says so far this year it has already inked deals to make store-brand energy drinks for six new retail customers. In its latest quarter, Cott reported a net loss of US$2.1M, compared to a US$8.3M profit a year ago—impacted by restructuring costs and stock option expenses. The beverage maker's first-quarter sales slipped to US$394.2M from US$395.5M a year ago. Although Cott warned of lower profits in 2006, company president and chief exec John K. Sheppard said the results "reflect the progress of our North American realignment in stabilizing the business. The results are in line with our plan as we continue taking aggressive action to position Cott for longer term profitability." Source: Canadian Grocer E-Newsletter, April 25, 2006.

Organics Standards Needed to Legitimize Industry
A lack of national organics standards in Canada is leaving consumers skeptical, growers frustrated and may threaten valuable exports, says a report in the Financial Post . Canada is one of the few Western countries that has not implemented national rules for organically produced food resulting, according to sources cited in the report, a "free-for-all" where consumers have no way of determining whether the organic foods offered at the grocery store live up to claims touted on their labels. According to the report, the Canadian Food Inspection Agency says its plans to have regulations ready for publication earlier this month have been delayed, but the agency says it expects to have national organic standards in place by the end of the year. If this timeline isn't met, organic growers risk huge losses as the European Union—which imports tens of millions of dollars worth of organic food from Canada annually—says it will ban imports of Canadian organics effective January 1, 2007. Source: Canadian Grocer E-Newsletter, April 25, 2006.

C-store Owners Protest Ontario's Tough Tobacco Laws
Hundreds of Korean-Canadian convenience store owners rallied outside of the Ontario legislature last week to protest the government's tough anti-smoking policies, which they say are causing them severe economic hardship. The Ontario Korean Businessmen's Association, organizer of the protest, says tax hikes on tobacco, higher insurance rates—a result of a surge in tobacco-related robberies—and costs associated with a new law requiring the removal of cigarette displays as of 2008, is driving many small operators to the brink of bankruptcy. Organizers of the protest say they want the same consideration from the government that the province's tobacco growers received when, last fall, that group was allocated $100M to facilitate a switch to other crops. Canadian Grocer E-Newsletter, April 25, 2006.

Robert Wegman Dies at 87
Robert Wegman, chairman of family-owned Wegmans Food Markets Inc., has died at age 87. Wegman had served as chair of the 90-year-old grocery chain, based in Rochester, N.Y., since 1969. Source: Canadian Grocer E-Newsletter, April 25, 2006.

Grocery Pioneer Steve Stavro Dies at 78
Steve Stavro, the founder of Knob Hill Farms grocery chain and one-time owner of the Toronto Maple Leafs, has died at age 78—reportedly of a heart attack. A legend in the Canadian grocery industry, Stavro—known as "The Honest Grocer"—created a buzz in 1962 when he opened a 60,000-sq.-ft. Knob Hill Farms "food terminal" in Toronto. Stavro was a founding member of the Canadian Federation of Independent Grocers and the recipient of the industry's most prestigious award—The Golden Pencil. Stavro, who came to Canada at age 7 from Macedonia, was awarded the Order of Canada in 1992. Source: Canadian Grocer E-Newsletter, April 25, 2006.

Couche-Tard Expands Again
Canadian convenience-store giant, Alimentation Couche-Tard Inc. says it has inked a deal—through its Circle K Stores Inc. subsidiary—to purchase 90 convenience outlets from Spectrum Holding Inc. Although terms of the deal were not disclosed, Laval, Que.-based Couche-Tard said the stores, located in Georgia and Alabama, would add sales of US$325M to its revenues and contribute to its earnings on an annualized basis. With its network of 4,909 stores, Couche-Tard is the third-largest c-store retailer in North America. Source: Canadian Grocer E-Newsletter, April 13, 2006.

E.D. Smith to Buy Grocery Unit of Golden Valley Foods
Winona, Ont.-based E.D. Smith Income Fund says it has signed a letter of intent to acquire the grocery products division of Golden Valley Foods Ltd., for an undisclosed amount. British Columbia-based Golden Valley Foods, a leading manufacturer of private label and branded jams, jellies, marmalades and salsa in Western Canada, generates annual sales of $14.1M. The E.D. Smith fund says it expects the acquisition will immediately add to distributable income and result in cost-saving synergies related to distribution. The deal is expected to wrap up in early May. Source: Canadian Grocer E-Newsletter, April 13, 2006.

Metro's Earnings Up 27%, Propelled by A&P
Propelled by its acquisition of A&P Canada, Metro Inc. saw its second-quarter earnings jump 27.5% to $57M. Canada's third-largest grocery retailer said sales for the Q2 period ending March 11, swelled 75.5% to $2.4 billion. Same-store sales, including the A&P stores, rose 1.6%. Montreal-based Metro, which purchased A&P Canada last July for $1.7 billion, said that over the next few quarters it will concentrate on finding savings from its acquisition of the 236 A&P Canada stores. The retailer said it is aiming to achieve savings of $35M this year and a further $25M in 2007. Metro's president and CEO Pierre H. Lessard added: "We will also work on implementing our integration and rationalization, and our information systems to A&P Canada's operations." Source: Canadian Grocer E-Newsletter, April 13, 2004.

Saputo Enters Europe
Canadian dairy giant Saputo Inc. has agreed to purchase German cheesemaker Spezialitaten-Kaserei De Lucia GmbH for an undisclosed amount. The German company makes and sells Italian cheeses such as mozzarella and ricotta, largely under the De Lucia brand. The company—which employs about 60 people at its facility in Heiden, Germany—generated revenue of 20 million euros ($28.2 million) in 2004. Montreal-based Saputo, one of North America's largest dairy processors, said the German acquisition complements its activities in Canada, the United States and Argentina. Source: Canadian Grocer E-Newsletter, April 12, 2006.

Sobeys Unloads Cash and Carry Outlets
Sobeys Inc. has announced it has sold off 11 of its cash and carry outlets in Ontario to The Skor Food Group Inc. for $13.5 million. Canada's second-largest grocery retailer also said it plans to shutter its three remaining cash and carry outlets in Ontario and Quebec. Sobeys said the cash and carry operations contributed $210 million in annual sales of tobacco and other products and that disposal of these assets will have a net $1.5 million pre-tax negative impact on its 2006 earnings, but will help annual earnings. The retailer added that the sale and closures are "consistent with the company's stated focus on its core food retailing and distribution business." Mississauga, Ont.-based Skor said it has no plans to layoff the 200 employees of the 11 southern Ontario outlets, which operate under the Lumsden Brothers banner. Some 28 employees of the stores set for closure in Ottawa, Montreal and Matane, Que., however, will be displaced. Source: Canadian Grocer E-Newsletter, April 12, 2006.

Canada Bread Buys U.K. Bakery
Toronto-based Canada Bread Company Ltd. has expanded its U.K. operations with the purchase of Walsall, England-based Harvestime Ltd. bakery, for an undisclosed amount. Harvestime, which employees 250 people and generates annual sales of about $39 million, is a producer of par-baked breads, rolls and specialty bakery products largely for retail customers in the United Kingdom. "The U.K. and European specialty bakery market is a high growth opportunity for Canada Bread," said company president and CEO Richard Lan, "The acquisition of the Walsall bakery immediately provides us with a stronger presence in the retail bakery market and broadens our base in bagel manufacturing to other specialty par-baked produtcts." Source: Canadian Grocer E-Newsletter, April 7, 2006.

FPI Denies Any Wrongdoing in Export Dispute
Seafood processor Fishery Products International (FPI) Ltd. is denying claims made by Newfoundland's fisheries minister Tom Rideout that it is guilty of shipping unprocessed fish out of the province without permission. In a recent release, the Newfoundland-based company said its exports of non-commercial fish were carried out legally and that "any insinuation that the company concealed or attempted to conceal any shipments is completely false." In addition to the consultation with department officials, FPI said every pound of fish in every shipment was approved for export, duly documented, signed and sealed by the Canadian Food Inspection Agency. Minister Rideout levelled the accusations against FPI during a rally in which workers were protesting the company's plans to cut jobs and close plants in the province. Source: Canadian Grocer E-Newsletter, April 7, 2006.

Head of CMA Calls for Fat Tax
A tax on junk food should be imposed to battle Canada's growing obesity problem, urges Dr. Ruth Collins-Nakai, president of the Canadian Medical Association. According to Statistics Canada (2004 numbers) 8% of children and 23% of Canadians are obese. Collins-Nakai suggests that a tax on fatty foods would make them less desirable to consumers, noting that a similar strategy has worked to combat cigarette consumption. The doctor noted that fat taxes could be imposed several ways; for instance, higher costs passed on to consumers or a surtax on food companies that use unhealthy additives. Source: Canadian Grocer E-Newsletter, April 7,2006.

No Mass Closures for HBC—Zucker
The Hudson's Bay Company's (HBC) new owner, Jerry Zucker, has squashed rumours that plans were in the works to unload as many as 80 HBC outlets by unveiling a real estate strategy that includes revitalizing and improving the company's real estate portfolio. Rumours had been swirling that Zucker had circulated a list of underperforming sites—which were potentially up for grabs—to retailers such as Sobeys, Metro and Canadian Tire; HBC denies a list existed. Said Zucker in a recent release: "I am truly excited about this company's opportunities and we intend to grow HBC's five formats by improving our portfolio, not through mass closures. That's just not in the cards and anyone speculating that it is, is not informed of my vision for HBC. Source: Canadian Grocer E-Newsletter, April 7, 2006.

Grocers Hear the Call of the Mall?
Grocery retailers are considering returning to traditional shopping malls—according to a recent report in the Toronto Star. With the future of department stores or "anchor" tenants such as the Hudson's Bay Company and Sears uncertain, mall managers are looking at other possibilities for this "real estate." In the report, Paul Brundage, executive vice-president of real estate management at Oxford Properties—owner of a number of shopping malls in the Greater Toronto Area—said supermarket chains, for instance, are looking at getting back into malls. The report noted that Oxford Properties recently signed a deal with Loblaw Cos. Ltd. to build a grocery store on the lot outside of the Scarborough Town Centre. Source: Canadian Grocer E-Newsletter, April 7, 2006.

Old Dutch to Buy Humpty Dumpty
Old Dutch Foods Ltd. has agreed to purchase Kitchener, Ont.-based Humpty Dumpty Snack Foods Inc. for $26.7 million in cash. The move would help Winnipeg-based Old Dutch better compete against snack food giant Frito-Lay Canada. Under the terms of the deal, the brand Humpty Dumpty will remain, but the company would become a subsidiary of HD Snax Ltd. — a subsidiary of Old Dutch. A deal struck by the two companies last year was dropped when a group of shareholders, objecting to the terms of the bid, threatened legal action. Old Dutch said it was too early to determine if the new deal would result in job losses. Source: Canadian Grocer E-Newsletter, March 26th. 2006.

Sobeys' Q3 Spurred by Strong Sales
Helped by robust sales and improved productivity, Sobeys Inc. said its third-quarter earnings climbed to $45.7 million, up from $44.8 million a year ago. The Stellarton, N.S.-based grocery retailer said sales during the period ending February 4, 2006, jumped 8.7% to $3.17 billion, with a 4.1% increase in same-store sales. "Our steadfast focus on food and improved execution drove strong same-store sales again this quarter," said Sobeys' president and CEO Bill McEwan. "In addition, our ongoing productivity initiatives and our extensive Ontario business process, supply chain and systems transformation initiative remains right on track." Source: Canadian Grocer E-Newsletter, March 29th. 2006.

Loblaw Unveils Joe Fresh
As it continues to battle Wal-Mart, Loblaw Cos. Ltd. is hoping to grab the attention of budget-conscious shoppers with its new Joe Fresh Style private-label clothing collection. Toronto-based master brand developer Joe Mimram's—the design force behind Club Monaco and Caban—name is tied directly to the stylish offerings, which are currently available in 40 of Loblaw's Real Canadian Superstores. The collection features some 400 styles for men and women—skirts, pants, footwear and accessories—that have an average price point of $14. Source: Canadian Grocer E-Newsletter, March 29th, 2006.

L'Oreal buys Body Shop
LONDON — Body Shop International PLC, the British retailer which promotes natural-based cosmetics, said Friday it has agreed to be taken over by L'Oreal of France in a $1.14 billion(U.S.) cash deal. Body Shop will retain a separate identity and its current management, the companies said. Source: Mar. 17, 2006. 06:21 AM ASSOCIATED PRESS

Weston Profits Enjoy Healthy Spike
George Weston Ltd. has posted positive numbers in its fourth quarter, thanks mainly to its baking business. The latter has enjoyed a lift from its focus on more whole-grain products. Weston posted net income of $249 million, or $1.85 a share, compared with a loss of $1million (six cents a share) in the same period a year earlier. Sales of whole-grain products did particularly well in Q4, with an overall increase of 7% in bakery unit sales. In the past year, Weston restructured its bakery operations by adding new products, closing plants and increasing prices. Source: Canadian Grocer E-Newsletter, March 3rd. 2006.

Frito Lay Works to Capture Ethnic Market
Frito Lay is introducing a new line of Asian-inspired potato chips and snacks in an attempt to capture Canada 's largest ethnic group. Wasabi- and spicy-curry-flavoured potato chips hit the Toronto and Vancouver markets in February. Their launch is being supported by a targeted marketing campaign in Chinese-language newspapers and television stations. Chips account for more than 50% of Canada 's $1.1-billion salty snack-food market. According to NPD Canada, 32% of Canadians eat chips at least once a week. Research suggests that Canadians are starting to seek out more intense and exotic flavours. Frito Lay created and tested roughly 40 different chip flavours, including seaweed, cucumber and green tea, before choosing wasabi and spicy curry. Source: Canadian Grocer E-Newsletter, March 3rd. 2006.

Loblaw Bears Down on Technology
Predicting future consumer demand, Loblaw Cos. Ltd. is leading the charge on putting point-of-sale data to effective use. Loblaw has been using software for the past 18 months to forecast demand and drive replenishment at hundreds of its more than 1,000 stores. Up next is a plan to manage warehouse inventory and other corporate assets using the same data. Ideally, say company executives, the software will be able to account for seasonal changes and react to peaks and valleys in such a way that Loblaw could better ensure in-stock levels for its customers. The company is converting all of its stores from frame-relay communications to a DSL-based high-speed network. It is also working to upgrade its self-checkout software. In one store, the retailer is testing a new "two-handed" U-Scan system from Fujitsu that will allow two items to be scanned at once. Source: Canadian Grocer E-Newsletter, March 3rd. 2006.

Coutu Canadian Sales Rise; American Sales Drop
Jean Coutu Group Inc. has said that, while sales at its American stores are on the decline (same-store sales at its US network fell 0.1% in January), sales at its Canadian outlets are on the rise. The company bought 1,549 US Eckerd drugstores in July 2004 (for US$2.4 billion) and has struggled with their integration. Total US sales fell 1.4% to $709.4 million in January, reflecting, in part, the closing of 78 Eckerd stores. Meanwhile, overall sales at Jean Coutu's Canadian stores rose 3% to $186 million. Source: Canadian Grocer E-Newsletter, March 3rd. 2006.

Loblaw Introduces Clothing Line
Loblaw Cos. Ltd. has announced plans to launch a low-priced, private-label apparel line, in a further effort to increase its competitiveness against Wal-Mart Canada. The company hopes that its Joe Fresh rollout will counter the disappointing financial results it has encountered with a number of non-grocery introductions. Loblaw will redesign some of its superstores to accommodate the expanded apparel section. Meanwhile, Wal-Mart Canada is getting ready to unveil more food and apparel at its larger superstores across the country, late this year or early next. Source: Canadian Grocer E-Newsletter, March 3rd. 2005.

Canadian Tire eyes Mortgages, GIC's
Canadian Tire Corp., the iconic retailer known for printing it's own "money", is considering offering mortgages, investment savings accounts and other financial products to it's customers. The strategy is meant to fuel growth over the next five years for the retail chain, which has about 1,100 stores, gas stations and car washes in communities coast to coast. "We are evaluating new products and services within Canadian Tire Financial Services to include things like mortgages, things like high-rate savings (accounts)" and guaranteed investment certificates, chief executive Wayne Sales said at a retail conference held by CIBC World Markets yesterday. Source: Madhavi Acharya-Tom Yew-Toronto Star Business Section, March 2, 2006.

Giant Tiger coming to GTA soon
Giant Tiger plans to open stores in Mississauga and Brampton this spring. In Mississauga, a 26,000 square-foot is set to open March 18 at 3200 Erin Mills Parkway in a former Food Basics location. In Brampton, a 38,000 square-foot store is to open April 1 in the Kingspoint Plaza at 370 Main St. N. (Highway 10) in a former A&P grocery store. Jeff York, the president of Ottawa-based Giant Tiger Stores Ltd., says the company has had good response to its new stores in Ajax, Newmarket, Bradford, Bolton and Acton. "We have had numerous requests from customers to open more stores in the area", he says. Giant Tiger, a privately held Canadian company, was established in 1961 in Ottawa's Byward Market and now has 159 locations throughout Ontario, Quebec, Manitoba, Saskatchewan, Alberta and New Brunswick. There are 99 stores in Ontario. Source: Toronto Star, Saturday edition, February 18, 2006, Food section.

Capers Certified as First Organic Grocer
Capers Community Markets, a natural and organic foods retailer based in Vancouver, has become the first certified organic grocer in Western Canada. Capers has been certified by Quality Assurance International (QAI), an independent third-party certification organization in the US that recognizes compliance with strict national quality standards, as governed by the USDA’s National Organic Program (NOP) Standard. (Canada doesn’t currently have a national standard and certification system, but it is currently in the process of developing and implementing one.) A grocer must successfully pass a rigorous voluntary organic grocer certification process to receive this designation. Capers is the first company in Canada to do so. All of Capers’ three Greater Vancouver locations are now certified in produce, bulk grocery and pre-packaged goods. www.capersmarkets.com. Source: Canadian Grocer E-Newsletter, February 3, 2006.

Giant Tiger Stores Come to Metro Toronto
Giant Tiger Stores Limited has announced plans to move into the Greater Toronto Area. The Ottawa-based private company will open two stores in the GTA this spring: one in Brampton, another in Mississauga. The former will be a 38,000-sq.-ft. store, the latter a 26,000-sq.-ft. store. Giant Tiger recently opened locations in Ajax, Newmarket, Bradford, Bolton and Acton, Ont. Giant Tiger is a discount store known for its selection of clothing, groceries and everyday basic needs. Established (1961) in Ottawa's Byward Market, it has grown to 159 locations (99 in Ontario) throughout Ontario, Quebec, New Brunswick, Manitoba, Saskatchewan and Alberta. www.gianttiger.com Source: Canadian Grocer E-Newsletter, February 3, 2006.

Consumers Seek Balance in Food Intake
Canadian consumers are looking for balance among taste, nutrition and convenience while demanding easier meal-preparation solutions, according to the recent NPD Group report. The 8th annual Epic report, by the global grocery consumption research company, also indicated that meals continue to move out of home, and that ageing and obesity are leading to three trends: nutrition versus indulgence; consumers looking for a point of differentiation in food; and preventative measures. "The rate of dieting in Canada is trending up," said Marion Chan, vice-president of the NPD Group. Last year, 19% of Canadians were on a regular diet compared to 16% in 2001. Older Canadians are imposing diets on themselves as a preventative measure, said Chan. While in 2000 some 23% of Canadians depended on their doctor's advice regarding diet, that number tumbled to 16% last year. The Canadian Food Guide also lost ground, as fewer Canadians (42% last year, down from 50% five years ago) indicated that they followed the government guidelines. While CFG has lost some of its relevance to a significant number of consumers, 61% of Canadians over the age of 45 reported that they frequently check labels to determine whether the food they’re considering purchasing contains anything they’re trying to avoid. The annual Epic report covered food consumption at breakfast, lunch and dinner. Source: Canadian Grocer E-Newsletter, February 3, 2006.

Humpty Dumpty Appoints CEO
Humpty Dumpty Snack Foods Inc. has appointed Darek Nowakowski president and chief executive officer. Most recently, Nowakowski was general manager and vice-president of the fresh foods group for Maple Leaf Foods Ltd. Source: Canadian Grocer E-Newsletter, February 3, 2006.

Empire to Establish REIT
Empire Co., which controls Sobeys Inc., has announced plans to set up a real estate investment trust that will focus on developments outside eastern Canada. The Stellarton, NS-based company plans to retain a 49.5% ownership stake in Crombie Real Estate Investment Trust, subject to the effects of a 5% overallotment option granted to the underwriters. The REIT will initially own a mixed portfolio of 44 properties, including strip malls, enclosed shopping centres and office buildings. It will capitalize on its relationship with Sobeys to drive expansion in neighbourhood shopping centres. Grocery-store-anchored malls have proven a successful cash-flow generator. Empire has a long-standing real-estate subsidiary that has developed sites for other arms of the Sobey family holdings. These include Sobeys Inc. and Empire Theatres Ltd. Source: Canadian Grocer E-Newsletter, January 30, 2005.

Metro Suffers Profit Hit; Still on Acquisition Trail
Following its acquisition of A&P Canada, Metro Inc. continues to look for potential properties—in spite of shrinking profits. Canada's third-largest supermarket chain posted a 17% loss in profits in its third quarter. Company president and CEO Pierre Lessard said: "If an opportunity arrived in Canada I think we'd be quite interested in looking at any acquisition." He also indicated that the company has its eye particularly on western Canada. Expansion in the West would help the Montreal-based company become a national chain. Metro's first-quarter profits came in at $32 million, or 28 cents a share. That compares with $38.6 million, or 40 cents, in the year-earlier period. The company chalks its drop mostly up to the costs of integrating its 236 newly acquired A&P and Dominion stores. Metro sales for the quarter, meanwhile, rose 74% to $2.52 billion. Source: Canadian Grocer E-Newsletter, January 30, 2006.

CCC Shuts Down Seven Stores
Consumer Community Co-operative (CCC), Canada 's second-largest retail food co-operative, closed seven of its stores in Atlantic Canada in January in response to poor sales. An eighth store will be converted to private, independent ownership. The news did not come as a surprise to industry insiders; according to one source, some CCC retail outlets have been unprofitable for a decade. Four of the closing stores are in Nova Scotia: in Bras d'Or, Amherst, Middleton and Bridgewater. The rest are in Fredericton and Saint John, NB; and Corner Brook, NL. The closures leave approximately 130 full-time and part-time employees out of work. The CCC outlet in Summerside, PEI, is still operational, pending discussions of its transfer to an independent. In all, the CCC will now operate 18 stores. Source: Canadian Grocer E-Newsletter, January 30, 2006.

Supervalu to Buy Albertson's
Albertson's Inc. has agreed to be purchased by an investor group led by Supervalu Inc., a deal that will divide the grocery chain among retailers and financial buyers. The purchasers will pay US$9.7 billion in cash and stock. They will also assume US$7.7 billion in Albertson's debt. With the announcement, the closely watched and complicated auction for the struggling chain comes to a close. The deal features the takeover of 1,124 stores by Supervalu, making the Minneapolis-based company the second-largest supermarket company in the United States, after Kroger. Source: Canadian Grocer E-Newsletter, January 30th. 2006.

Hudson Bay sells to Zucker
The board of Hudson's Bay Co., Canada's oldest company, unanimously agreed Thursday to a sweetened $15.25-a-share offer from U.S. billionaire Jerry Zucker's investment firm. Mr. Zucker's Maple Leaf Heritage Investments Acquisition Corp. will pay about $860.4-million plus debt for the shares it doesn't already own, up from its previous offer of $832.2-million. That's 50 cents per share more than its last offer. The move comes after several other parties expressed interest in buying the 336-year-old retailer, among them U.S. equity firm Cerberus Capital Management LP and buyout powerhouse Onex Corp. with mall developer Mitchell Goldhar, the Globe and Mail reported. Today's offer, however, likely seals the deal, analysts said. “I can't imagine that there's going to be a white knight that comes out of the woodwork,” Lori Wachs, president and portfolio manager at Delaware Investments, told Report on Business Television. “I would imagine that everyone's looking to close it sooner rather than later.” Advertisements Hudson's Bay, established in 1670, is Canada's largest department store retailer. It has 550 stores as part of the Bay, Zellers and Home Outfitters chains. The company employs almost 70,000 people across Canada. “The board has conducted a thorough process to maximize value for the shareholders of HBC, and after considering several offers for the company, has unanimously endorsed and is recommending that shareholders tender to the amended offer,” Yves Fortier, Hudson's Bay's governor, said in a statement. “We are satisfied that the amended offer constitutes full and fair value for the company.” Hudson's Bay shares jumped $1.10 or 7.9 per cent to $15.03 in Toronto with 10.7 million shares changing hands. The conditions on the offer, which expires Feb. 24, have been significantly reduced. The amended offer is conditional on a minimum of 662/3 per cent of the shares of HBC being tendered (from a 90-per-cent threshold in its last offer), tender of a majority of HBC's unsecured subordinated debentures under the offer and the receipt of all necessary regulatory approvals. “On behalf of the management of HBC, we are pleased with the outcome of the auction process and fully support Mr. Zucker's enhanced offer,” said George Heller, HBC's president and chief executive. Mr. Zucker has also offered to buy all of the outstanding 7.5 per cent convertible unsecured subordinated debentures due in 2008 at $1,010 for each $1,000 principal amount of debentures, the company said. “We are pleased to have reached this agreement with HBC today and to be associated with a company with such a long and proud history,” Mr. Zucker said in a statement. “Through the implementation of more efficient methods we will positively differentiate HBC from its competitors.” Maple Leaf will mail the amended offer by Feb. 10. Maple Leaf's Robert Johnston told ROB-TV his firm boosted the price after a closer look at HBC's books and with the intention of changing the offer to friendly from hostile. There is a break fee, he said, though he didn't specify how much. He said Maple Leaf doesn't plan to sell large chunks of the Canadian retailer. “In a large part, we have no plans to sell any major assets to any other retailers,” he said. Apart from his pursuit of Hudson's Bay, Mr. Zucker isn't widely known in Canada. Few of the secretive billionaire's investments are household names or marquee properties. His Charleston, S.C.-based holding company InterTech Group Inc. owns mainly obscure chemical and engineered product makers. Mr. Zucker also owns electronics companies, hockey rinks, laser tag centres, banking machine suppliers, two Charleston restaurants and commercial real estate. At various times, he's also owned banks and textile makers, including Montreal-based Dominion Textile Inc. His ragtag collection of businesses generated an impressive $3-billion (U.S.) in revenue last year, making InterTech one of the largest private companies in the United States, according to Forbes Magazine. The magazine also ranked Mr. Zucker as the 346th wealthiest American in 2004, with an estimated fortune of more than $1-billion. He grew up in Florida and South Carolina, where his parents settled, and went to the University of Florida, where he earned undergraduate degrees in math and science, plus a masters in electrical engineering. Mr. Zucker's first notable business deal was in 1982, when he was still in his early thirties. He and a colleague bought a division of the textile manufacturer where they worked, RM Engineered Products. He used the investment as a springboard for a series of increasingly larger manufacturing acquisitions in the 1980s, including several divisions of then-shrinking chemicals giant E.I. du Pont de Nemours & Co. Maple Leaf owned about 18.8 per cent of HBC in October when he began bidding for the company. Source: By TAVIA GRANT Thursday, January 26, 2006 Posted at 2:40 PM EST Globe and Mail Update

Turnaround for Jean Coutu
The Jean Coutu Group Inc. has posted a profit of US$30.8 million in its second quarter. This comes on the heels of a loss a year ago. With more than 2,000 drugstores in the U.S. and Canada, the Montreal-based company's earnings for the quarter ended November 26 amounted to 12 cents a share. This contrasts sharply with the US$4-million (or four-cent-a-share) loss the company posted a year earlier. The previous quarter's results included a foreign-exchange loss on monetary items of US$19.7 million. Revenue, meanwhile, enjoyed a slight rise, to US$2.71 billion from US$2.7 billion. Company officials have credited the turnaround to improved sales growth in the U.S., partially offset by issues associated with supply chain disruptions. Source: Canadian Grocer E-Newsletter, January 16, 2006.

Kraft Foods May be Spun off?
Industry speculation is in full throttle on the timing of Altria Group's predicted spin-off of the company. The company owns 85% of Kraft Foods. The spin-off is of particular interest in Canada, in the wake of Kraft's announcement of the sale of some of its Canadian operations. The Illinois Supreme Court's decision last month to toss out a US$10.1 billion class-action lawsuit against Altria's Philip Morris USA unit, has added further interest in Altria's next move.

Safeway Turns Spotlight o