Roundup: Fed survey shows steady growth; Hostess has 80 potential buyers; more
Fed survey: Economy growing at steady pace
A pickup in consumer spending and steady home sales helped lift economic growth in October and early November in most parts of the United States, according to a Federal Reserve survey. The one exception was the Northeast, which was slowed by Superstorm Sandy. The Fed says growth improved in nine of its 12 regional banking districts. Growth was weaker in New York, Philadelphia and Boston — areas where Sandy caused widespread disruptions. The survey says growth improved despite nervousness about tax increases and spending cuts that could kick in next year if Congress and the Obama administration can't reach a budget deal before then.
Group urges Medicaid expansion
A statewide coalition of social service organizations is urging Gov. Tom Corbett to expand the state's Medicaid program, known as Medical Assistance, as called for by federal health care reform. The Pennsylvania Health Access Network sent the letter to Corbett, a Republican who opposed the Affordable Care Act, asking him to accept federal funding starting in 2014. “Right now more than 1.3 million Pennsylvanians do not have health insurance,” according to the letter, signed by more than 60 groups. The Supreme Court in June upheld most of the Affordable Care Act, except for a provision that would penalize states that did not expand Medicaid, the government's health insurance program for poor people. The court ruled states could decide to opt out of the expansion without penalty. Corbett is waiting for more information from the federal government on how much the expansion will cost the state before making a decision, spokeswoman Christine Cronkright said.
Many interested in Hostess
Days into its plan to dismantle itself, the former maker of Hostess Twinkies has attracted serious interest from more than 80 potential bidders, the company's chief executive said Wednesday. “I can't answer details about bidders and (the) bid process, but I can tell you that we now have over 80 parties signed up to confidentiality agreements, and the vast majority are capable and serious bidders,” said Gregory Rayburn, who is presiding over the wind-down of 82-year-old Hostess Brands. Hostess assets, including brands such as Ho Hos and Wonder Bread, could fetch more than $1 billion.
Rue21 profit falls 6.5% to $8M
Teen clothing retailer rue21 Inc. said third-quarter profit fell by 6.5 percent to $8.17 million, or 33 cents a share, although sales grew 15.6 percent because of new store growth and better results from existing stores. Marshall-based rue21 said its latest results compare to a profit of $8.74 million, or 35 cents, a year ago. Sales totaled $225.16 million, up from $194.76 million. The company said it had a $2.9 million pretax litigation expense, or about 8 cents a share, in the third quarter related to a prospective settlement of wage and hours claims in California. The 879-store chain raised earnings guidance to $1.83 to $1.86 a share for the year, up from $1.55 in fiscal 2011.
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Other business news
• Financial Transaction Services, Philadelphia, said Wednesday it acquired Dependable Payment Processing and Discount Payment Processing, affiliated companies based in Mars. Collectively known as DPP, the companies provide electronic payment processing products. They employ six people, who are retaining their jobs. Financial terms of the deal were not disclosed.
• Millcraft Investments Inc. promoted Lucas B. Piatt and Marcus M. Piatt to president of the two major divisions of the company, while their father and Millcraft founder, Jack B. Piatt Sr., remains as company chairman and CEO. Lucas, who also retains his job as chief operating officer, will head up Millcraft Investments, which includes development, property management and brokerage services, while Marcus heads the Millcraft Hospitality and Millcraft Tenant Construction Services.
• Steve Steinour, CEO of Huntington Bancshares Inc., was named Banker of the Year for 2012 by American Banker, the industry's leading daily trade newspaper. Steinour was credited for turning around the Columbus-based bank, which operates about 40 branches in the Pittsburgh area. A Gettysburg native, Steinour previously was CEO of RBS Citizens Financial Group, the parent of Citizens Bank.
— Staff and wire reports
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