Starbucks sells Tazo as sales disappoint
Starbucks reported disappointing sales growth at its coffee shops around the world Thursday, and announced it will sell its Tazo tea brand to Unilever for $384 million.
Shares of Starbucks Corp. tumbled nearly 7 percent in after-hours trading Thursday.
Starbucks, which bought Tazo about 18 years ago for $8.1 million, said it will now focus on its Teavana line. Unilever, which owns Lipton, PG Tips and other tea brands, called the deal a "perfect strategic fit." Both companies expect the deal to close in the next year. Although Starbucks has been shutting down standalone Teavana stores, it still sells the brand's teas in Starbucks.
"Teavana is the brand we want to focus on exclusively," said Starbucks CEO Kevin Johnson.
The coffee chain also said Thursday fourth-quarter sales rose 2 percent at its established locations worldwide. Analysts had expected a rise of 3.3 percent, according to FactSet.
Overall, the company reported net income of $788.5 million, or 54 cents per share, in the three months ending Oct. 1. Adjusted earnings came to 55 cents per share, matching what analysts expected.
In the same period a year ago, it reported net income of $801 million, or 54 cents per share.
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Sweden hands off VW probe to Germany
Swedish prosecutors say a criminal investigation in Sweden related to the emissions scandal at German automaker Volkswagen has been shut down and handed over to their German counterparts.
Anti-corruption prosecutor Alf Johansson said they have found no evidence against people with connections to Sweden, or against the Swedish subsidiary in the VW Group, which imported and distributed the vehicles in Sweden.
Johansson said Thursday the Swedish investigation was being discontinued after consulting with German prosecutors in Braunschweig who are running an ongoing probe into suspected fraud and other offenses in the scandal over cars that cheated on diesel emissions tests.
The scandal that erupted two years ago included diesel models made at Volkswagen's Chattanooga plant.
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Mortgage rates stable at 3.94 percent
The costs of borrowing money to buy a home held steady this week as U.S. mortgage rates hover near relative lows.
Mortgage buyer Freddie Mac said Thursday the average rate on 30-year, fixed-rate mortgages didn't budge from last week's 3.94 percent. One year ago, the benchmark rate was 3.54 percent. Historically, the average has been around 6 percent.
Long-term home loan rates tend to track the yield on 10-year U.S. Treasury notes, which have risen since early September, possibly in anticipation of tax cuts pushed by President Donald Trump and Republicans in Congress.
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Canadian softwood import duties set
The U.S. Department of Commerce issued its final finding Thursday on the softwood lumber duties Canadian producers must pay, escalating a trade dispute amid the renegotiation of the North American Free Trade Agreement.
The department said most Canadian producers will pay a combined countervailing and anti-dumping rate of 20.83 percent, down from 26.75 percent in the preliminary determinations issued earlier this year.
Commerce Secretary Wilbur Ross said the decision "defends American workers and businesses from unfair trade practices."
The department also said Canadian exporters sell softwood lumber at less than fair value and Canada provides unfair subsidies to producers.
Canadian Foreign Minister Chrystia Freeland called the duties "unfair, unwarranted and deeply troubling," saying they harm workers in Canada."