B&G Foods Inc wants the small, orphan brands that no one else loves. 

“We have a laundry list and any number companies that we talk to on a regular basis,” said B&G Chief Executive David Wenner. “We’re buying all these things people don’t want to run.”

B&G pointed to the success of its acquisition of Cream of Wheat, saying “no one was paying any attention to it. So that’s where we come in.”

“We’re looking for things are aren’t commodities. Higher margin products, ethnic foods are great. Las Palmas and Ortega — they’ve grown steadily over the years and we love that,” Wenner said.

B&G aims to stick to its tried-and-true practice of buying dry grocery products that immediately add to earnings or revenues.

B&G wants to carve out orphan products from larger food companies. When it approaches potential sellers, B&G says “We’re able to come in and take these five things  you don’t want.  We’re able to come in and take these things over very very quickly,” Wenner said. 

The company targets smaller brands or private companies. “We’re not buying Kraft tomorrow.” 

Still, some acquisitions may have to wait. Sellers are still looking for premiums that reflect higher stock prices from a year ago, rather than the current depressed prices, Wenner said.

“The brands that may be available are on hold — I see some more consolidation in the food industry at some point,” Wenner said. “But we still have sellers that are looking for double-digit EBITDA (earnings before interest, taxes, depreciation and amortization), and that’s not where the world is today.”

(Reuters photo)

Don’t expect Campbell Soup Co to take advantage of its relative strength — and the weakness of some competitors

Speaking at the Food & Agriculture Summit in Chicago, Campbell Chief Executive Douglas Conant said “we only want to compete in some narrow areas. We only want to compete in geographies that we exist. Staying close to home will take you a long way.”

Conant said there are very few good properties available since assets bought by private equity are still tied up by those firms, and carving out a brand from a larger company is difficult.

“We’re not interested in buying a troubled asset,” Conant said.

Campbell previously sold off some assets in the United Kingdom and Ireland. It sees Russia and China as a leading growth opportunity to expand on its own. Conant said there are no assets to buy in those markets since most food consumption comes from homemade soup.

The company plans to spend about 10 cents a share to expand into those new markets, where it expects to be profitable in the next five years.

“We still know how to make soup and we can add a lot to that,” Conant said.

(Refiles to correct Donahoe's first name to John.)

To sell Skype, or not to sell Skype. That is the question for eBay, and Wall Street has diverging opinions on whether the San Jose company will or won't unload its Internet telephone service.
    
Skype was acquired under the reign of former CEO Meg Whitman (now a California gubernatorial hopeful) and touted as a nifty way for eBay's millions of sellers and buyers to connect. That reality never materialized, and current CEO John Donahoe has acknowledged that synergies between eBay and Skype are nonexistent.
    
Still, Skype is on a tear, growing at double digits and adding 350,000 global users a day. The five-year-old company logged $551 million in revenue in 2008 -- that number is expected to double by 2011 -- and is now a subject of great speculation by analysts, who wonder whether eBay plans to spin it off, or hold it close. 
                              
Cowan and Co's Jim Friedland, for one, thinks it's for sale. Writing in a note the day after eBay held an analyst presentation to outline the company's three-year plan, Friedland said it appeared "eBay was using the Skype discussion to trigger a bidding war between Google and Microsoft."
       
"We believe the asset would be attractive to both Google and Microsoft to enhance their web-based enterprise application services. In addition, Skype's user base of 405 million, which is particularly strong internationally, would likely strengthen Google's dominant position in the consumer web app market."

But Bernstein Research's Jeffrey Lindsay did not see it that way: "We think the dearth of buyers such as Google or Microsoft will mean that eBay is more likely to spin out part of Skype to the public (like Time Warner did initially with Time Warner Cable)."
    
Huh. Donahoe, incidentally, has said only that eBay will do what's best "to maximize Skype's potential and value."
    
Deutsche Bank's Jeetil Patel opined that, since Skype is performing well, "Management should hold on to this business model" and Credit Suisse's Spencer Wang said he did not see eBay rushing to sell.
    
"While we think the company would be open to parting with Skype at the right price (currently valued at $1.8 billion on eBay's balance sheet), a divestiture of Skype does not appear imminent," Wang wrote.

(Photo: Reuters)

Natural and organic food grocer Whole Foods will sell 13 stores as part of a settlement that ends an antitrust battle with U.S. regulators over its acquisition of rival Wild Oats.

Is your store on the list?  

• 7133 N. Oracle Rd., Tucson, AZ
• 8688 E. Raintree Dr., Scottsdale, AZ
• 2584 Baseline Rd., Boulder, CO        
• 1651 Broadway St., Boulder, CO        
• 3180 New Center Pt., Colorado Springs, CO  
• 5910 S. University Blvd., Littleton, CO
• 9229 N Sheridan Blvd., Westminster, CO
• 340 N. Main St., West Hartford, CT  
• 4301 Main St., Kansas City, MO
• 1090 St. Francis Dr., Santa Fe, NM         
• 7250 W. Lake Mead Blvd., Las Vegas, NV
• 19440 N.W. Cornell Rd., Hillsboro, OR
• 6930 S. Highland Dr., Salt Lake City, UT

(Photo\Mike Blake, Reuters)

Campbell Soup Co is hungry for acquisitions to add to its soup, snacks or beverage businesses in the next year or two, instead of pursuing a mega-merger to create a large food conglomerate.

As far as scooping up smaller brands, Campbell CEO Douglas Conant said “We  have a balance sheet and we’re not afraid to use it.”

“There’s evidence that there will be some good values coming free within the next year or two,” Conant told Reuters in an interview on the sidelines of the Consumer Analyst Group of New York conference in Florida. He did not name specific targets.

Campbell, which makes its namesake soup, Pepperidge Farm cookies and crackers and V8 vegetable juice, is content with being a “focused” food company, rather than joining with another foodmaker to become a larger player, he said.

Last year, H.J. Heinz Co CEO William Johnson said Campbell would be a “good fit” with Heinz, when asked about the company by an investor at the Heinz annual meeting. But in an interview yesterday, Johnson called the comment “ancient history” and said he was only answering a question honestly.

Conant, asked about merging with Heinz to become a much larger company, said Campbell has “no interest” in such a move.  

“All the large food companies right now are struggling under the weight of their huge portfolios,” Conant said. 

(Additional reporting by Brad Dorfman)

(Photo, of Contant when he was named to the job in 2001, by Reuters)

PepsiCo Inc said the food and beverage sector is faring too well to find any cheap merger opportunities.

Chief Executive Officer Indra Nooyi, speaking on a conference call after the soda company posted fourth-quarter earnings, didn’t blame the the credit markets for the lack of mergers. Instead, Nooyi said the sector was in too good of shape to find any real bargains.

“I think companies that are financially solid can still access the financial market. The real thing is the food and beverage industry is doing just fine overall, and so in our sector there aren’t that many deals that are cheap enough to create value,” Nooyi said.

The cultured Irish classic Waterford Wedgwood is to be boxed up and sold for scrap. Hardly as stunning as its stock symbol (WTF) would imply, the decision to call in receivers is not expected to tempt any last-minute beaus for the debt-laden china and crystal maker. Consumers are looking to dress their tables with lower-priced settings. Analysts are not even convinced a big, fat Greek wedding of a recovery with plate-smashing exuberance would make a whole lot of difference. The company’s debt is bid at just 3 percent of face value and offered at 8 percent.

Its website boasts a combined history of “over 600 years of heritage, tradition and craftsmanship” in its four brands - Waterford, Wedgwood, Rosenthal and Royal Doulton. Efforts to modernize its product range must have been particularly challenging. Barring some breakthrough in plate technology, the company was also reported to be selling its Rosenthal brand before Christmas in an effort to help drag its stock up from the less-than-one-euro-cent level, where it has languished for more than four years.

If nothing else, the demise of WTF means retailer Macy’s will have one less thing to have to try to sell. It will also mean fashion and lifestyle icons Vera Wang and Martha Stewart, as well as Peter Rabbit, will have to go elsewhere to find China.

Other Deals news:

* Bonds of petrochemical company LyondellBasell, which is saddled with $26 billion in debt, remained at just 4 percent of face value after a Jan. 4 deadline to renegotiate the terms of its debt passed. Privately held LyondellBasell said last week it was considering chapter 11 bankruptcy protection in the U.S., but a Netherlands-based spokesman for the world’s third-largest petrochemicals firm declined to comment on Monday morning.

* Poland wants to sell its remaining 76.5 percent stake in utility Enea, minority owned by Sweden’s Vattenfall, for 7 billion zlotys ($2.4 billion), the treasury minister was quoted as saying.

* Satyam Computer Services’ management and some funds have approached two smaller rivals about a merger to fend off any possible hostile bid for India’s fourth-biggest software services exporter, the Business Standard said, but one of the firms said it was not interested.

* An Indian investor has offered to buy the entire equity of Egyptian medical equipment firm Alexandria Medical Services for 100.8 million Egyptian pounds ($18.3 million), the stock exchange said.

(Photo: www.wedgwoodusa.com)

After scoring one of the biggest exclusive deals in music retailing in a long while– or at least since Wal Mart snagged the exclusive for the new AC/DC opus “Black Ice” earlier this year– Best Buy began selling the long awaited new recording by Guns n’ Roses, “Chinese Democracy,” on Sunday.

But stepping down the escalator at the chain’s Chelsea story in New York City on Sunday, when a more than 17 year wait for original Guns n Roses material ended, it would have been easy to walk by the modest display box with the Chinese Democracy CDs and vinyl LP’s. There were few other signs of CDs being available, and the store was not blasting it on the P.A. system as a record store would have back in the old days.

It was a far cry from the scenes in 1991, when fans waited in long lines outside record stores in cities around the world for the band’s “Use Your Illusion” two-CD set.

But then again, 1991 was a long time before iTunes, Apple’s online music store, made its debut. While Best Buy has the exclusive on “Chinese Democracy” in actual stores, the 14-song set is available on iTunes too, unlike the AC/DC record which can only be bought at Wal-Mart stores (and to accommodate Wal-Mart free New York City, at MTV’s store in Times Square.)

And for all the quiet at the Chelsea store on Sunday afternoon, the new Guns n Roses is a clear early hit, with iTunes on Monday morning ranking it the #1 album in the U.S.

Either way, we’ll know how well the CD did both online and at Best Buy next week, when Billboard reports its debut on the record charts.

(Photo/Reuters)

Hedge fund manager William Ackman has come up with a plan to save troubled discount retailer Target: form a trust with the land the Minneapolis-based store chain owns, spin off 20 percent of that into a $5 billion IPO, then use that money to lower Target’s debt and in the process maintain its credit rating. Ackman’s hedge fund, Pershing Square Capital Management owns 10 percent of Target.

The plan, a revised version of an earlier real estate plan by Ackman, might sound like a good idea on paper. But commercial REITS are down 57 percent so far this year, according to the FTSE NAREIT US Real Estate Index (industrial and office REITs are down even more, 62 percent).

And the IPO market is all but dead. The last IPO to launch goes all the way back to early August, and 87 companies have pulled their IPO plans so far this year . (One IPO is scheduled to price Wednesday night, however.)

Certainly Target shareholders looked unimpressed by Ackman’s latest plan, bidding the retailer’s stock down 10 percent to a new 5 1/2-year low.

Still, credit Ackman for thinking big. A $5 billion deal would rank as by far the largest among REITs of any kind this decade, according to Thomson Reuters data.

So far the largest REIT IPOs of the decade are Douglas Emmett, which went public in October 2006 with a $1.6 billion stock flotation and is down 45.6 percent over its offer price, and KKR Financial Corp, which launched a $900 million IPO in June 2005 but whose parent KKR Financial Holdings in March agreed to sell it after it failed to live up to expectations.

But if management and other shareholders go along with Ackman’s plan, time may be on his side. Launching an IPO takes time and given enough of it, the commercial real estate and IPO markets could rebound. One day.

Two would-be suitors — Bristol-Myers and Walgreen — walked away from attractive targets this and avoided potentially costly bidding wars at a time of difficult deal financing and daily hits to the financial markets.

Although Bristol-Myers and Walgreen walked away from their respective deals for different reasons, the decision to bow out marks a sign of caution by even strategic buyers in the nervous economy.

Bristol-Myers on Monday walked away from its offer to acquire the 83-percent of ImClone Systems it did not already own after Eli Lilly and Co trumped its bid with a $6.5 billion deal. Bristol-Myers decided against counter-bidding and instead cashed in its 17-percent stake in ImClone for about $1 billion.

Meanwhile, Walgreen on Wednesday withdrew its $75 per share cash offer to acquire Longs Drug Stores, avoiding a bidding war with Longs’s existing merger partner CVS Caremark.

Walgreen said it decided to walk away due to the recent deterioration in the economy, Longs’s refusal to hold merger talks, and the uncertainty of leaving its bid in limbo for an extended period of time.

At a time when arbitrage spreads on deals that already have committed financing continue to remain wide, perhaps avoiding costly bidding wars and bowing out is a smart move?