AG pushes energy reform at retail confab

State Attorney General Martha Coakley would like to see the state tackle energy in the same way it's approaching health care reform.

Energy, like health care, is a major cost-driver for small businesses, Coakley said in a keynote address at the Retailers Association of Massachusetts' Awards of Excellence luncheon at Bentley University in Waltham yesterday.

"If it's not kept under control, if it's not contained, it's one of those costs that breaks the camel's back," Coakley said.

Coakley, who noted she's been sounding the alarm in the past few months about the need for cost-effective energy, said her attendance at a recent national conference showed that the stakeholders in the energy debate — the energy industry, legislators and retailers — "aren't that far apart."

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Ikea regrets use of forced labor in East Germany

BERLIN — Swedish furniture giant Ikea expressed regret Friday that it benefited from the use of forced prison labor by some of its suppliers in communist East Germany more than two decades ago.

The company released an independent report showing that East German prisoners, among them many political dissidents, were involved in the manufacture of goods that were supplied to Ikea 25 to 30 years ago. The report concluded that Ikea managers were aware of the possibility that prisoners would be used in the manufacture of its products and took some measures to prevent this, but they were insufficient.

"We deeply regret that this could happen," said Jeanette Skjelmose, an Ikea manager. "The use of political prisoners for manufacturing was at no point accepted by IKEA."

But she added that "at the time we didn't have the well-developed control system that we have today and we clearly did too little to prevent such production methods."

Ikea commissioned auditors Ernst & Young to look into allegations aired by a Swedish television documentary in June, but first raised by a human rights group in 1982.

Rainer Wagner, chairman of the victims' group UOKG, said Ikea was just one of many companies that benefited from the use of forced prison labor in East Germany from the 1960s to 1980s.

"Ikea is only the tip of the iceberg," he told The Associated Press in an interview earlier this week.

Wagner said he hoped that Ikea and others would consider compensating former prisoners, many of whom carry psychological and physical scars from arduous labor they were forced to do.

"Ikea has taken the lead on this, for which we are very grateful," he told a news conference in Berlin, where the findings of the report were presented.

Peter Betzel, the head of Ikea Germany, said the company would continue to support efforts to investigate the use of prisoners in East Germany in future.

Today, he said, "we can exclude with almost 100 percent certainty that such things as happened in East Germany happen elsewhere."

© Copyright 2012 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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US industrial production drops 0.4 percent

WASHINGTON — Superstorm Sandy depressed U.S. industrial output in October, while production of machinery and equipment declined sharply, reflecting a more cautious outlook among businesses.

The Federal Reserve says industrial output fell 0.4 percent last month, after a 0.2 percent gain in September. Excluding the storm's impact, production at the nation's factories, mines and utilities would have been up about 0.6 percent.

Factory output, the most important component, fell 0.9 percent. It would have been unchanged without the storm. Machinery production fell 1.9 percent, while production of electrical equipment, appliances and components declined 1.4 percent.

Manufacturing has weakened since spring, partly because companies have scaled back purchases of equipment and machinery. Many are worried about tax increases and federal spending cuts that take effect in January unless Congress reaches a budget deal.

© Copyright 2012 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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Foreign holdings of US debt hit $5.46 trillion

WASHINGTON — Foreign demand for U.S. Treasury securities rose to a record level in September for the ninth straight month. The increase suggests overseas investors are confident in U.S. debt despite a potential budget crisis.

The Treasury Department says total foreign holdings rose to $5.46 trillion in September, up 0.1 percent from August.

China, the largest holder of U.S. government debt, barely increased its holdings in September to $1.16 trillion. Japan, the second-largest holder, increased its holdings to $1.13 trillion. Brazil trimmed its holdings to $267 billion.

Investors continued to buy U.S. Treasurys, even as lawmakers and President Barack Obama remained at odds over whether to raise the U.S. borrowing limit as part of a broader budget deal.

© Copyright 2012 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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Hostess shutdown hits Mass. workers in stomach

Hostess Brands Inc., whose sweet treat roster includes Twinkies, Ding Dongs and Ho Ho's, filed a motion today in bankruptcy court seeking permission to shut down its business and sell its assets, including its iconic brands and facilities.

The company, based in Irving, Texas, is moving "promptly" to lay off most of its 18,500-member workforce, which includes nearly 300 workers at 13 Hostess facilities in Massachusetts, and has suspended bakery operations at all its plants, said company CEO Gregory F. Rayburn.

The company's board of directors authorized the wind down of Hostess Brands after one of its largest unions, the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, initiated a nationwide strike that crippled the company's ability to produce and deliver products at multiple facilities, company officials said.

In September, the union rejected a "last, best and final offer" from Hostess designed to lower costs so the company could attract new financing and emerge from Chapter 11 bankruptcy, Rayburn said.

Delivery of products will continue and Hostess Brands retail stores will remain open for several days in order to sell already-baked products. The company permanently closed three plants as a result of the work stoppage on Nov. 12. Two days later, Hostess said it would be forced to liquidate if sufficient employees did not return to work to restore normal operations by 5 p.m. yesterday. The company then determined yesterday night that an insufficient number of employees had returned to work to enable the restoration of normal operations, Rayburn said.

"We deeply regret taking this action. But we simply cannot continue to operate without the ability to produce or deliver our products," Rayburn said in a letter to employees. "All Hostess Brands employees will eventually lose their jobs — some sooner than others. Unfortunately, because we are in bankruptcy, there are severe limits on the assistance the company can offer you at this time."

The wind down will result in the closure of 33 bakeries, 565 distribution centers, nearly 5,500 delivery routes and 570 bakery outlet stores throughout the country. In addition to dozens of baking and distribution facilities in the United States, Hostess will sell its popular brands, which also include Drakes, Dolly Madison, and Wonder Bread.

In May, the company sent letters to Massachusetts officials and high-ranking politicians in 10 communities warning that its statewide facilities could shut down.

Affected state Hostess facilities include 91 Foster St. in Brockton; 601 Pond St. in Braintree; 189 Crawford St. in Fitchburg; 647 Andover St. in Lawrence; 420 Eastern Ave. in Malden; 323 Dalton Ave. in Pittsfield; 1566 State St. in Springfield; 2406 Cranberry Highway in Wareham; 215 West Boylston St., West Boylston; and four locations in Worcester at 75 Quinsigamond Ave., 39 SouthWest [LUV] Cutoff, 205 Chandler St., and 983 Milbury St.

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Cruiseport Boston books record season

Cruiseport Boston finished the 2012 season with a record 380,054 cruise vacationers, a 23 percent spike over 2011, according to the Massachusetts Port Authority.

Fueling the surge was Carnival Cruise Lines' "Carnival Glory," which began cruising from Boston to Canada in June. With a dozen four-, five- and seven-day cruises from Cruiseport Boston to Canada in June and July, the ship contributed some 85,000 passengers to the Black Falcon Cruise Terminal's yearly count, Massport said.

This year, 117 cruise ships docked at Boston, a 9 percent increase over 2011 — 63 of which began and/or ended their cruise in the Hub. In addition to the cruise passengers, who came from the all over the United States, Canada, Europe and Australia, more than 100,000 crew members visited Boston. The 54 other cruise ships stopped in Boston for a day or more to allow their passengers to tour the city and surrounding areas.

In addition to "Carnival Glory," Cruiseport Boston offered new choices for Canada and New England cruising, including Holland America's "Veendam," which offered seven-day sailings to Montreal as well as a repositioning cruise to South America via the Panama Canal. Three luxury lines — Compagnie du Ponant, Seabourn and Crystal Cruises — offered seven- and 10-day voyages to Canada and New England ports. "Norwegian Dawn," in addition to regular Bermuda cruises, sailed seven-day itineraries to Quebec, Massport said, adding that Canada and New England cruises more than doubled in 2012, growing by 119 percent.

During Hurricane Sandy, five ships destined for New York cruise terminals were diverted to Boston, during which time 9,000 passengers came to the Hub on the unscheduled ship visits, Massport said. Cruisers will also see more summer cruising options from Cruiseport Boston to Canada next year, the agency said.

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Convention center seeking hotel developers

The Massachusetts Convention Center Authority said today it has issued a request-for-proposals seeking development teams for two privately financed mid-priced hotels, totaling between 400 and 500 rooms on nearly three of the 5.6 acres of land the organization recently purchased near the Boston Convention & Exhibition Center.

Proposals are due Jan. 7, 2013, with groundbreaking for the new hotels scheduled to take place by late 2013 and completion by 2015, said MCCA Executive Director James E. Rooney.

"We have set the bar very high, but we also think we're providing a great opportunity," he said.

The MCCA expects the two hotels to be built next to each other, and to benefit from sharing certain facilities, including fitness rooms, kitchens and service areas. The MCCA is also requiring that the hotels include leasable ground floor retail or restaurant space in a move aimed at activating the entire D Street corridor in the South Boston Waterfront.

The hotels are geared to be mid‐priced, with room rates and amenities below the existing four-star hotels in the area, Rooney said.

Under the RFP, the MCCA plans to build and own a parking facility, to be used by hotel guests and the MCCA, and to establish a ground lease structure for the hotels. Developers will be responsible for designing the structures and 100 percent financing, building, owning and operating the hotels.

The project is expected to create 370 construction jobs and 175 permanent jobs, Rooney said.

"Between the revenues realized by the MCCA and the substantial tax revenues generated for the city and state, this land acquisition will have a high and fast payback; a win for the taxpayers," he said.

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'The D.A. Show' overnight success on CBS Sports Radio mother ship

CBS Sports Radio said today Damon Amendolara will host the network's weekday overnight show, which will debut Wednesday, Jan. 2, 2013.

"The D.A. Show" will be heard on select stations in 12 major U.S. cities from 2 a.m.-6 a.m. on air, streaming online and through the Radio.com application for mobile devices.

Amendolara joins the network from CBS Radio Boston's WBZ-FM "98.5 The Sports Hub," where he has served as evening host since the station's launch in August 2009. In addition, Amendolara is the sideline reporter for the New England Revolution on Comcast and a frequent guest and fill-in host for CSN's Sports Tonight/Sports Sunday.

"D.A. is an all-star in Boston, and his energy and understanding of the sports world will no doubt translate to a national platform," said Eric Spitz, director of programming for CBS Sports Radio. "Damon is certainly the man to keep listeners engrossed overnight, and his work at stations across the country, covering a multitude of different sports, will be beneficial to our listeners. His success and following on our local radio station and his charitable endeavors in the community prove he will make a great addition to our already outstanding lineup at CBS Sports Radio."

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The Davis Cos. raises $414M for second investment fund

The Davis Companies said it has completed fund raising for its second discretionary commingled investment vehicle, Davis Investment Ventures Fund II, with nearly $414 million of total commitments from institutional and high net worth investors.

The offering initially targeted $350 million and was oversubscribed, the real estate investment firm said.

The fund aims to continue the firm's history of value-oriented, opportunistic investing, and looking for debt and equity investments in the United States with a focus on Northeast markets where the firm can leverage its operating platform, Davis said.

The firm added that it currently owns and manages nearly 6 million square feet of real estate in the region with a 95 percent occupancy rate, and has acquired an additional $700 million of real estate debt, equity and securities within the last two years.

Fund II is fully discretionary and has four years remaining in its investment period. The fund is structured to allow joint ventures with outside capital sources seeking to partner with operating companies, as well as with other operators seeking capital or additional operating expertise and to provide recapitalization and bridge financing, the firm said.

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Glaxo's Avandia settlement will mean $2.1M for Massachusetts

A nationwide $90 million settlement with drugmaker GlaxoSmithKline LLC will bring more than $2.1 million to the Commonwealth, according to state Attorney General Martha Coakley.

Coakley's office has joined 37 other states in the settlement with GlaxoSmithKline, which resolves allegations the pharmaceutical company unlawfully promoted its diabetes drug, Avandia, by misrepresenting its cardiovascular risks and safety profile.

"When pharmaceutical companies misrepresent the safety of their drugs, they put patients at risk," Coakley said. "This settlement helps ensure that consumers will be protected from misleading marketing that can result in the unsafe use of prescription drugs."

Coakley's office alleged GSK promoted the diabetes drug to physicians and other health-care providers with false and misleading representations about its safety and misrepresented the drug's cardiovascular benefits when, in fact, the drug may instead increase risks, all in order to increase their sales of Avandia in the Bay State.

The $2.1 million settlement includes $100,000 for fees and investigative costs, while the remaining funds will pay for programs that lower costs for Massachusetts residents, combat unlawful marketing practices or benefit health-care consumers, Coakley said.

As part of the settlement, GSK agreed to reform how it markets and promotes diabetes drugs, and is prohibited from making any false or deceptive claims about any diabetes drug; making comparative safety claims not supported by substantial evidence or clinical experience; promoting investigational drugs; presenting favorable information previously thought of as valid but rendered invalid by contrary and more credible recent information and misusing statistics or otherwise misrepresenting the nature, applicability or significance of clinical trials.

The consent judgment is in addition to a settlement announced in July when Coakley obtained more than $35 million from GSK, on behalf of the Massachusetts Medicaid Program, due to its unlawful marketing of a number of drugs, including Avandia.

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