retail news in context, analysis with attitude

• The Los Angeles Times reports this morning that "California officials face mounting criticism from union leaders over plans to let retail giant Wal-Mart Stores Inc. enroll shoppers in President Obama's healthcare expansion.

"The state wants employees at Wal-Mart and other retailers to help consumers learn about their options and assist them in buying federally subsidized private insurance. These plans are part of state efforts to implement the federal healthcare law and reach out to 5 million Californians eligible for new coverage starting in January.

"Labor unions as well as some consumer advocates protest the idea of government officials partnering with Wal-Mart and paying for its help. They contend that the nation's largest retailer has no place advising others on health coverage when so many of its workers don't qualify for company benefits and end up in taxpayer-funded programs such as Medi-Cal."

Columbus Business First reports that bankrupt Hostess has filed a lawsuit against Kroger, claiming that the retailer owes it $2.8 million in overdue invoices.

Kroger has not yet issued a statement in response to the suit.

• WorldPay, the financial technology company, said yesterday that it has acquired YESpay International Ltd, described as "a leading payments services provider," in a deal that it says will allow the combined companies to "to fully exploit the evolving needs of omni-channel shoppers with a single payment service operating in-store, online and on mobile."

• The New York Times reports that Time Warner has decided to spin off its Time Inc. magazine business - including Time, Sports Illustrated and Fortune - into a public company separate from its cable TV and film businesses.

According to the story, the announcement came after the company ended negotiations with Meredith Corp. that would have resulted in a separate company owning many, but not all, of Time's titles. "The deal with Meredith fell apart in part because of Time Warner’s concern over the fate of four of Time Inc.’s famous but struggling magazines — Time, Sports Illustrated, Fortune and Money, according to three people with knowledge of the negotiations who could not publicly discuss private conversations. At one point Meredith expressed some interest in the news and sports magazines, but Meredith decided not to pursue them because such a deal would have diluted its controlling family’s shares in the new company, another person with knowledge of the negotiations said. If Time Warner retained those four titles, the economics of a full spinoff proved more appealing, this person said."

Reuters reports that Safeway "is exploring putting its Canadian property assets into a real estate investment trust" (REIT), a move that would be seen as returning value to shareholders.
KC's View: