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from Breakingviews:

Wal-Mart puts collar on Cerberus price for Safeway

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By Robert Cyran
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Could Cerberus pay more for Safeway? Based on the 2007 A&P-Pathmark merger, synergies could be worth more than half the $9.4 billion that the private equity firm’s Albertsons supermarket is paying for its U.S. rival. In theory that leaves room for a higher offer. But competition from the likes of Wal-Mart means cost savings may need to go to shoppers, not investors.

Both Safeway and Albertsons executives said in their conference call with investors that there would be significant cost savings, but they didn’t quantify them. A&P’s purchase of Pathmark seems a reasonable guide. Though smaller, the two companies were otherwise similar – mature grocery chains facing tough times due to rising competition. That merger generated $150 million of annual synergies, or about 1.4 percent of combined sales of $10.9 billion.

Revenue at Cerberus’s grocery arm and Safeway combined is some $54.7 billion, according to Jefferies research. At this percentage rate, annual savings would run about $750 million. Taxed at 30 percent and put on a multiple of 10, that’s a present value bigger than $5 billion.

from Breakingviews:

Cross-border arbitrage is expansive Bimbo’s yeast

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By Robert Cyran
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Cross-border arbitrage is the yeast for Grupo Bimbo’s aggressive expansion. In its latest deal north of the border, the acquisitive Mexican breadmaker is shelling out $1.8 billion to buy Canada Bread. Paying 20 times earnings to move into a mature market may seem questionable. But Bimbo’s earnings fetch an even higher multiple at home – and the deal should lower its weighted average cost of capital.

from Photographers' Blog:

A taste for music

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Haguenau, France

By Vincent Kessler

I love cooking and I have a passion for music. What then could please me more than an orchestra that plays music with instruments made out of vegetables?

I cannot remember when I first heard about the Vegetable Orchestra. But when I realized that they were planning to hold a concert some 40 kilometers from my home, I got in touch and was given the opportunity to watch them prepare for a performance.

from Data Dive:

Visualizing America’s food waste

Americans waste almost 40% of the food produced here, mostly after it gets into the hands of consumers. A new report by the Natural Resources Defense Council shows how much food is lost in various parts of the food distribution chain:

Dana Gunders, a scientist at the NRDC who wrote the report, comes up with two basic reasons why Americans waste so much food (the equivalent of $165 billion each year): 

from India Insight:

Mumbai’s local delicacies no longer everyone’s cup of tea

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Every day, for the past few decades, Dayanand Shenoy has taken an early morning train to Grant Road station in south Mumbai from his home in the suburb of Borivali. Initially, it was for work but now it's just for oven-fresh mava cakes from B Merwan.

The bakery, on the ground floor of a dilapidated four-storey building, has many admirers in India’s financial capital. Hundreds line up daily, some at sunrise, to buy cups of sugary tea and some bun maska (sweet milk bread slathered with butter).

from India Insight:

Old Delhi food steps into the digital age with start-up

With thousands of shops, hundreds of carts, horses, cows, vehicles and an ever-rising number of visitors and shoppers, Delhi’s Chandni Chowk can be a menacing place if you just want to savour a jalebi. But the syrup-drenched, pretzel-like traditional sweet from one of the oldest shopping hubs in India is a mere click away.

A new start-up promises to come to the rescue of many Delhiwallas who want to eat good food from the Mughal-era Walled City, but can’t stand the chaos of what a government portal calls the food capital of India.

from Photographers' Blog:

Circle of life at Greece’s fish farms

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Sofiko village, Greece

By Yorgos Karahalis

Fish farming was a business that a few decades ago was completely alien in Greece, where eating fish was strictly related to the local fisherman, the weather conditions and the phase of the moon.

These days, regardless of the moon and the weather, we can all buy fresh fish at extremely low prices, every day. And from my experience of the industry during the days I photographed its fish farms and hatcheries, I realized there is more to the process than I thought – it’s a production line that resembles the circle of life itself.

from Breakingviews:

Food deal shows how investors eat up synergies

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By Robert Cyran
The author is a Reuters Breakignviews columnist. The opinions expressed are his own.

Sysco’s acquisition of US Foods shows how investors are eating up synergies. The $3.5 billion purchase, revealed on Monday, received a rapturous reception, with the buyer’s market valuation surging by as much as a quarter – or $5 billion – before giving up some gains. Hefty cost cuts help the merger math.

from Breakingviews:

Review: A no-nonsense recipe for retail success

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By George Hay

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Malcolm Walker has a no-nonsense recipe for retail success. While larger supermarkets have expanded upmarket, overseas, and away from food, he’s made a fortune selling cheap frozen dinners to hard-up Britons through his Iceland Foods chain. It’s all about meeting customer demand, controlling costs, and staying focused, his autobiography shows. Still, Walker’s travails down the years are a reminder how easily things can go wrong in the food business.

from Breakingviews:

M&A could help Nestle tackle sales slowdown

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By Robert Cole

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

It is easy to see why Nestle might want to do deals. The Swiss food group is finding it hard to deliver on sales growth targets. And it can afford to buy itself out of trouble.

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