Supplier alters claim on Allens remnant
Attorneys for D&E Farms submitted an amended Perishable Agricultural Commodities Act claim of $2.29 million Wednesday after a bankruptcy judge last week overruled objections to the claim by Veg Liquidation, the former owners of Allens Inc.
Judge Ben Barry overruled Veg Liquidation's arguments that D&E Farms improperly included freight and fuel charges and that it breached its fiduciary duty to Veg Liquidation by claiming those expenses. Barry upheld Veg Liquidation's objection that the 18 percent interest D&E charged was too much and that 17 percent was the proper amount allowed under Arkansas law.
D&E Farms of Pennsylvania amended its claim to include the unpaid principal of $1.9 million, plus revised interest of $333,229, along with attorney's fees of $59,442.
Barry is still considering objections by Veg Liquidation to nearly $10 million in other claims made by other company's suppliers under the act.
In late October, the Siloam Springs-based canned-vegetable company filed for bankruptcy protection in U.S. Bankruptcy Court for the Western District of Arkansas. Sager Creek Acquisition Corp. bought the assets of Allens Inc. at auction in February and changed the name of the company to Sager Creek Vegetable Co. in July.
-- John Magsam
Fed OKs Bank of America dividend rise
WASHINGTON -- Federal regulators have given Bank of America a green light to proceed with a long-awaited dividend increase it had suspended because of a reporting error.
The Federal Reserve announced Wednesday that it has accepted the revised capital plan filed in May by the second-largest U.S. bank. Bank of America Corp. disclosed in April that it discovered the error, on the value of securities, in a financial report it had submitted to the Fed. The data in the report were used to calculate results of an annual "stress test" of the bank conducted by the Fed this year.
Under the revised plan, Bank of America will increase the dividend from a penny per share to 5 cents per share. The plan dropped a $4 billion stock buyback that the bank had proposed earlier.
Bank of America said Wednesday that its board had approved the dividend increase, payable Sept. 26.
The Fed approved Bank of America's original plan in March after the bank passed the Fed's stress test, an annual checkup of the biggest U.S. financial institutions. This year 30 banks underwent the tests to determine whether they have large enough capital buffers to survive a financial crisis.
Then in April, Bank of America disclosed the error, which was related to how it valued securities obtained in its acquisition of Merrill Lynch in 2009 during the crisis.
-- The Associated Press
Gas glut depresses Chesapeake's profit
Chesapeake Energy Corp., the natural-gas producer, said profit fell as a supply glut in the U.S. Northeast dragged down prices.
Second-quarter net income plunged by more than half compared with a year earlier even as the company cut spending and raised production. Chesapeake reported earnings of $191 million, or 22 cents a share, down from $580 million, or 66 cents, in 2013's quarter, according to a statement Wednesday.
"The earnings miss was all due to lower oil, gas, and liquids prices, but all operating results were positive and above guidance," said Fadel Gheit, an analyst at Oppenheimer & Co. in New York. "They continue to reduce costs and improve operating efficiency while selling assets and reducing spending."
Chesapeake shares rose 13 cents to close Wednesday at $26.19.
Chesapeake warned investors July 29 that the price it received for gas averaged $2.45 per thousand cubic feet during the quarter, a 51 percent decline from a year earlier. The company cited excess supply in the Marcellus shale region that feeds gas to New York, Philadelphia and other Northeast markets.
-- Bloomberg News
U.S. sales fuel Chrysler's 22% profit rise
DETROIT -- Chrysler Group's second-quarter net profit rose 22 percent, fueled by rising sales in the U.S.
The company on Wednesday reported that it made $619 million in the April-through-June quarter, compared with $507 million a year ago.
Revenue rose 14 percent to $20.5 billion.
Chrysler said its worldwide sales grew 12 percent in the quarter to 723,000 vehicles, with most of the increase in the U.S. Retail sales in the U.S. rose 16 percent, largely because of gains by the Jeep Grand Cherokee and Ram pickup.
Chrysler's U.S. market share rose almost a full percentage point to 12.1 percent.
The company raised its full-year forecast for worldwide shipments by 100,000 vehicles. It now expects to ship about 2.8 million cars and trucks.
Chrysler is in the process of merging with its Italian owner Fiat SpA. Fiat shareholders voted overwhelmingly on Aug. 1 in favor of the merger, which has been five years in the making.
The approval paves the way the new company, to be called Fiat Chrysler Automobiles NV, to list its shares in the U.S., likely by mid-October. It will have its fiscal home in Britain. U.S. operations will remain in Auburn Hills, Mich.
-- The Associated Press
Mexican Coke plant got pre-fire threats
MEXICO CITY -- A Coca-Cola distribution plant in southern Mexico had received threats before attackers burned four of its delivery trucks in an area known for drug-gang turf battles, the company said.
Coca-Cola's largest Mexican bottler, Femsa, said in a statement late Tuesday it closed a distribution plant in the southern state of Guerrero last Wednesday after receiving threats.
Femsa did not specify the nature of those threats but said they were directed at delivery personnel.
The Guerrero state prosecutor's office said the motive in the attack in the township of Arcelia is under investigation.
While local companies are frequent targets for gang extortion, attacks on multinational firms are rarer.
In 2012, the Knights Templar cartel in the neighboring state of Michoacan burned five warehouses and dozens of vehicles owned by the Sabritas snack company, a Mexican subsidiary of PespsiCo.
The cultlike drug gang said it believed that Sabritas had let law-enforcement agents use its trucks for surveillance. The company denied that.
-- The Associated Press
Business on 08/07/2014