Sleep Country Canada Holdings signs deal to buy Hush Blankets

Sleep Country buys Hush

Sleep Country Canada Holdings Inc. has signed a deal to buy Hush Blankets, a direct-to-consumer seller of weighted blankets, pillows, sheets and bed-in-a-box mattresses.

Under the deal, Sleep Country will acquire a 52 per cent stake in Hush for $25 million.

The company has also agreed to buy the other 48 per cent in annual 16 percentage point stake increments starting March 31, 2023, at a price based on the business's financial performance.

Hush was founded in 2017 by Lior Ohayon and Aaron Spivak and launched a weighted blanket in Canada in 2018.

Sleep Country says Hush will continue to operate as an independent business led by Ohayon and Spivak and a board including senior management from Sleep Country and Hush.

The deal is expected to close on Oct. 22.

As Bitcoin goes mainstream, Wall Street looks to cash in

Bitcoin goes mainstream

Love cryptocurrencies or hate the very idea of them, they’re becoming more mainstream by the day.

Cryptocurrencies have surged so much that their total value has reached nearly $2.5 trillion, rivaling the world's most valuable company, Apple, and have amassed more than 200 million users. At that size, it’s simply too big for the financial establishment to ignore.

Firms that cater to the world's wealthiest families are increasingly putting some of their fortunes into crypto. Hedge funds are trading Bitcoin, which has big-name banks starting to offer them services around it. PayPal lets users buy crypto on its app, while Twitter helps people show appreciation for tweets by tipping their creators with Bitcoin.

And in the latest milestone for the industry, an easy-to-trade fund tied to Bitcoin began trading on Tuesday. Investors can buy the exchange-traded fund from ProShares through an old-school brokerage account, without having to learn what a hot or cold wallet is.

It's all part of a movement across big businesses that see a chance to profit on the fervor around the world of crypto, as a new ecosystem further builds up around it, whether they believe in it or not.

“The one thing you can say for certain is that the advent of the era of the Bitcoin ETF opens up the opportunity for Wall Street to make money on Bitcoin in a way that it hadn’t been able to previously,” said Ben Johnson, director of global ETF research at Morningstar. “The winners in all of this are the exchanges and the asset managers and the custodians. Whether investors win or not is a big, bold question mark.”

Bitcoin has come a long way since someone or a group of someones under the name Satoshi Nakamoto wrote a paper in 2008 about how to harness computing power around the world to create a digital currency that can’t be double-spent. The price has more than doubled this year alone to roughly $62,000. It was at only $635 five years ago.

Supporters of cryptocurrencies say they offer an ultra-important benefit for any investor: something whose price moves independently of the economy, rather than tracking it like so many other investments do. More high-minded fans say digital assets are simply the future of finance, allowing transactions to sidestep middlemen and fees with a currency that’s not beholden to any government.

Critics, meanwhile, question whether crypto is just a fad, say it uses too much energy and point to all the stiff regulatory scrutiny shining on it. China last month declared Bitcoin transactions illegal, for example. The chair of the U.S. Securities and Exchange Commission, Gary Gensler, said in August that the world of crypto doesn’t have enough investor protection and “it’s more like the Wild West.”

That hasn't been enough to halt the immense momentum for crypto, as it's gone from an online curiosity to a bigger part of the cultural and corporate landscape.

U.S. Bank earlier this month said it has begun offering a cryptocurrency custody service for big investment managers. That means it essentially holds their Bitcoin in safekeeping for them, and it expects to offer support for other coins soon.

Other name-brand banks have also announced intentions to offer custodial services for crypto.

“It’s not just in the fringes and dark corners of the Web that it’s happening,” said Kashif Ahmed, president of American Private Wealth in Bedford, Massachusetts.

Ahmed doesn’t recommend his clients invest in crypto. Before then, he said he’ll need to be able to “go to my local supermarket and buy things for my family and offer crypto and not be laughed out of the store.”

But others are more willing to try it.

In a survey by Citi Private Bank of family offices around the world that manage money for wealthy people, roughly 23% said they have made some investments in crypto. Another 25% said they are researching it.

The growing acceptance of crypto on Wall Street has created a new crop of darlings that help people buy it. Crypto trading platform Coinbase has a market value of roughly $64 billion, for example, putting it on par with such established companies as Colgate-Palmolive, FedEx and Ford Motor.

At Robinhood Markets, meanwhile, the company that became famous for getting a new generation of investors into the stock market is increasingly becoming a place for crypto trading. This spring was the first time when new Robinhood customers were more likely to make their first trade in cryptocurrencies rather than in stocks.

In the end, what many on Wall Street see lasting may not be as much Bitcoin and other cryptocurrencies as the technology that underlies them.

Called the blockchain, it allows for a public ledger that everyone can check and trust, and many expect it to lead to a wealth of innovations. It's akin to today's Netflix, Facebook and other services that sprung out of the infrastructure built during the boom and bust of the dot-com bubble.

“The applications built on this new software architecture appear to be growing more quickly than past technologies,” Bank of America strategists Alkesh Shah and Andrew Moss wrote in a recent research report positing digital assets are only in their first inning of growth. “New companies are likely to emerge and poorly positioned companies will exit, creating significant upside potential for some and downside for others.”

JPMorgan Chase, for example, is already using blockchain technology to improve fund transfers between global banks. That’s the same JPMorgan Chase run by CEO Jamie Dimon, who said in an interview with Axios this month that bitcoin has “got no intrinsic value.”

S&P/TSX composite tops 21,000 for first time, U.S. markets also up

TSX hits new record

Canada's main stock index was in record territory as it topped 21,000 for the first time, as gains in the technology sector helped boost it higher, while U.S. stock markets also rose.

The S&P/TSX composite index was up 70.48 points at 21,055.85.

In New York, the Dow Jones industrial average was up 179.10 points at 35,437.71. The S&P 500 index was up 28.49 points at 4,514.95, while the Nasdaq composite was up 86.53 points at 15,108.34.

The Canadian dollar traded for 80.92 cents US compared with 80.78 cents US on Monday.

The December crude contract was up 46 cents at US$82.15 per barrel and the November natural gas contract was down a penny at US$4.98 per mmBTU.

The December gold contract was up US$6.20 at US$1,771.90 an ounce and the December copper contract was down a penny at US$4.71 a pound.

Cargo congestion swamps Port of Vancouver

Port bursting at seams

The Port of Vancouver is “bursting at the seams” with inbound container cargo.

The flood of cargo into B.C. ports, which follows the resumption of operations at several major Chinese ports following COVID-19 outbreaks, has severely strained operations for shippers scrambling to navigate through the cargo traffic jam.

Bruce Rodgers, executive director of the Canadian International Freight Forwarders Association, described the situation as “very dire. I don’t think we’ve experienced anything like this previously.”

Rodgers said cargo infrastructure, warehousing and truck transport operators are used to dealing with 3% to 5% spikes in traffic, but the current cargo traffic surge amounts to 15% more than normal per day and has accumulated day-to-day in recent weeks.

“Drayage operators’ chassis are full, and there’s no room to move any containers,” Rodgers said of the situation in Vancouver. “Warehousing is busting at the seams. If there were short-term solutions, the industry would have reacted already; the industry is very nimble that way. No, this is somewhat of a crisis situation.”

Compounding the lack of transport capacity to move shipments and a dearth of storage for stranded containers, Rodgers noted, is a reciprocal lack of exports coming from B.C.’s Interior to refill import containers.

Without the export demand, empty containers are sitting in Vancouver, which further strains storage and handling capacity.

The issue of cargo containers not being in the right places at the right time has plagued global shipping since mid-2020.

Werner Antweiler, associate professor at the University of British Columbia’s Sauder School of Business, said the seismic changes in the way people consume products and what they have been buying since the pandemic started have dramatically shifted demand on shipping routes. Demand for capacity on many routes has consequently skyrocketed while demand on other trade loops has plummeted.

Antweiler said that containers with shipments heading into routes with little traffic are then stuck there after being unloaded because there is no demand to export cargo in the other direction.

The result? Empty containers that no one is willing to pay to move to where they are needed.

“We need to look at how these containers can be moved, because right now, no one is willing to pay for it,” Antweiler said. “It’s a missing market. We have to figure this out, and this will require some co-ordination to make sure in the future there’s a way – a mechanism – to pay for the moving of stranded containers to where they are needed. Perhaps through an industry-wide insurance or something like that … because it’s a very clear problem staring us in the eye.”

Ford promises 'huge' investment in Windsor auto plant after shift cuts

Ford promises investment

Ontario Premier Doug Ford says the province and federal governments will be making a "huge" investment in a Windsor, Ont., auto assembly plant to help ramp up production after the company announced a shift cut.

Stellantis, formerly known as Fiat Chrysler Automobiles, announced last week that it will cut its Windsor Assembly Plant down to one shift next spring in a move that will mean about 1,800 lost jobs.

The company says the move comes as the automotive industry faces significant headwinds including the semiconductor shortage and the effects of COVID-19.

The cut from two shifts comes after Stellantis cut the third shift at the minivan plant in 2020 at a loss of about 1,500 jobs.

Ford, speaking near Windsor on Monday, says he wants to see three shifts again at the plant, and he will be speaking with Stellantis leadership on Tuesday.

The premier was not able to offer details on the investment, but said between both levels of government it's "hundreds of millions" of dollars.

Stellantis has reaffirmed its commitment in a 2020 collective agreement with the local Unifor union to spend upwards of $1.5 billion at the plant.

The Windsor plant produces the Chrysler Pacifica, Chrysler Voyager and Chrysler Grand Caravan.

Ford also spoke of his interest in having a battery facility in Windsor.

"We have all the natural resources, we have the lithium, we have the nickel, we have the cobalt, folks, everything is here," he said.

"We don't need to bring these batteries in from overseas. We have everything here. On top of that we have the best workforce anywhere in the world ... Any people out there that are listening that want to expand in Ontario, especially the battery business, we'll be at your front doorstep and we'll be ready to make a deal with you."

Disney delays 'Indiana Jones 5,’ ‘Black Panther 2’ releases

Disney delays big releases

The Walt Disney Co. is pushing back the release dates of many of its upcoming titles, including the untitled Indiana Jones movie and the Black Panther sequel “Wakanda Forever.”

The company said Monday that the fifth Indiana Jones, a James Mangold-directed and Steven Spielberg-produced installment which sees the return of Harrison Ford as the adventurous archaeologist, will be delayed almost a year and open in theaters in June 2023.

“Black Panther: Wakanda Forever” has also been pushed several months, from July 2022 to November 2022. Both films are currently in production.

Other Marvel titles like “Doctor Strange in the Multiverse of Madness,” “Thor: Love and Thunder,” “The Marvels” and “Ant-Man and the Wasp: Quantumania” were also all delayed several months.

Hudson's Bay sues Quebec retailer alleging trademark infringement of Zellers brand

Bay sues over Zellers

Hudson's Bay Co. ULC is suing a Quebec retail family over the use of the Zellers brand.

In a statement of claim filed in Federal Court, the company accuses the Moniz family of trademark infringement, depreciation of goodwill and so-called passing off — the deceptive marketing or misrepresentation of goods.

The Moniz family is behind various recent trademark applications and corporate registries, including Zellers Inc. — incorporated in June 2020 — Zellers Convenience Store Inc. and Zellers Restaurant Inc.

The defendants could not immediately be reached for comment and a response to the claim has not yet been filed in court.

HBC claims that the use of the Zellers brand and trademark threatens to cause confusion between their goods and services and those offered by the Bay.

The retailer alleges that the intention of taking over the Zellers brand was to either "confuse Canadians or recover a payment from HBC."

HBC says in court documents that although it closed the last of its stand-alone brick-and-mortar Zellers stores in 2020, HBC continued to have plans for the brand and did not abandon the Zellers trademarks and logos.

The company launched a pop-up Zellers shop inside a Hudson’s Bay store in Burlington, Ont., last summer.

HBC spokeswoman Tiffany Bourré said the pop-up Zellers store was intended to "delight our customers with a fun and nostalgic experience with one of HBC’s most beloved brands."

The company is planning a second pop-up Zellers shop at its department store in Anjou, Que., she said.

Bourré added that the company filed the claim to protect its Zellers brand and avoid consumer confusion.

"The allegations in the claim relate to planned unauthorized third-party Zellers stores, among other unauthorized uses of the Zellers brand," she said in an email. "HBC intends to pursue this claim vigorously."

Cryptocurrency exchange goes to court over phantom BC company

Lawsuit over crypto firm

A pair of companies behind an international cryptocurrency exchange platform are taking Bitmex Exchange Ltd. to court, claiming the B.C.-registered firm is shrouded in mystery and should be dissolved after being “incorporated for an improper purpose” including alleged trademark infringement and financial fraud.

In a petition filed in BC Supreme Court on September 29, HDR SG PTE Ltd. and its affiliate HDR Global Service (Canada) Ltd. claim they are part of the BitMEX Group, which runs a peer-to-peer cryptocurrency exchange platform offering “virtual asset derivative products” tied to Bitcoin.

HDR Global, according to the petition, originally filed a registration of the BitMEX trademark in Canada in February 2018, which was granted by the Canadian Intellectual Property Office in March 2021.

The companies claim Bitmex Exchange Ltd. was incorporated in B.C. in June 2020 and came to their attention when it registered as a money-services business with the U.S. Financial Crimes Enforcement Network days after it was formed. But the petitioners claim they’re “unaware of any activities, commercial or otherwise, that are actually carried out by [Bitmex Exchange Ltd.] in Canada or any other country.”

“BEL owns no property or any identifiable assets of any kind. It has no public profile or public website. BEL’s [registered and records office] is a shared workspace, at which BEL does not appear to carry on any business whatsoever,” the petition states. “Registered mail sent to BEL at this address has been returned unclaimed, and persons at the RRO location are unaware of BEL.”

“Due to the use of BITMEX EXCHANGE in BEL’s corporate name and on BEL’s [Money Services Business] registration, petitioners have reasonable grounds to suspect that BEL was incorporated for an improper purpose, such as trademark infringement or financial fraud,” the petition states.

For its part, the B.C. Registrar of Companies ordered Bitmex Exchange to provide the petitioners with corporate records in June 2021, but the company allegedly didn’t respond to the order. While the registrar has the authority to dissolve companies, it “does not exercise its authority” under the Business Corporations Act.

Staff at the registrar, according to the petitioners, “advised that this was due to its internal policy of declining to exercise its dissolution authority.”

“They further advised that his policy is general and applies to all companies which fail to produce corporate records in response to the Registrar’s orders, rather than any specific concerns about HDR’s request to dissolve BEL,” the petition states. “Instead, the Registrar advised the petitioners that they should seek redress in this Court.”

The petition’s factual basis has not been tested in court, and Bitmex Exchange Ltd. had not filed a response by press time.

TransAlta wind farm in N.B. taken offline after tower collapse

Wind farm tower collapse

TransAlta Renewables Inc. says it has temporarily taken a wind farm in New Brunswick offline after a tower collapse.

The Calgary-based company says one of the towers at the 167 MW Kent Hills wind facility in Kent Hills, N.B. collapsed. The facility is majority owned by TransAlta's indirect subsidiary Kent Hills Wind LP.

The company says there were no injuries. No one was in the area when the incident occurred and there are no homes in the immediate vicinity.

TransAlta says its emergency response team has secured the area to ensure safety. The remaining turbines at the Kent Hills 1 and Kent Hills 2 sites have been taken offline temporarily as a precaution.

TransAlta says it is working to determine the cause of the failure and to safely return the site to service.

TransAlta's Kent Hills wind farm consists of 50 wind turbines at Kent Hills 1 and Kent Hills 2, and five turbines at Kent Hills 3. The collapsed tower is located within the Kent Hills 2 site.

Businesses see higher inflation, wages and job changes, Bank of Canada reports

More willing to quit

New data from the Bank of Canada shows workers are more willing to leave their jobs in search of new work, and businesses working harder to attract talent.

Workers tell the central bank that they're more likely to quit their jobs for another position in the search for better hours and pay, or a change in industry.

Meanwhile, businesses say they're having a harder time finding workers, particularly in high-contact service industries, and are more willing to offer higher wages.

Firms that took part in the central bank's quarterly business outlook survey say they're going to pass on the higher payroll costs to customers.

Companies also say they're going to pass on higher shipping costs from supply-chain disruptions that they don't see abating until the second half of 2022.

Combined, almost half of businesses surveyed expect the pace of price increases to stay above three per cent over the next two years.

China's economic growth weakens amid construction slowdown

China's growth stalls

China’s economic growth is sinking under pressure from a construction slowdown and power shortages, prompting warnings about a possible shock to its trading partners and global financial markets.

The world’s second-largest economy grew by a weaker-than-expected 4.9% over a year ago in the three months ending in September, down from the previous quarter’s 7.9%, government data showed Monday. Factory output, retail sales and investment in construction and other fixed assets all weakened.

Manufacturing has been hampered by official curbs on energy use and shortages of processor chips and other components due to the coronavirus pandemic. Construction, an industry that supports millions of jobs, is slowing as regulators force developers to cut reliance on debt that Chinese leaders worry is dangerously high.

“Ripple effects to the rest of the world could be significant" due to weaker Chinese demand for raw materials, said Mo Ji of Fidelity International in a report. “Even developed markets, including the U.S., would not be immune to a significant tightening in global financial conditions as a result of a negative China growth shock accompanied by financial stress.”

Compared with the previous quarter, the way other major economies are measured, output barely grew in the July-September period, expanding by just 0.2%. That was down from 1.2% in the April-June period and one of the past decade’s weakest quarters.

The slowdown adds to pressure on Beijing to prop up activity by easing borrowing controls and spending more on building public works. But forecasters said even if that happens, activity will weaken before policy changes take effect.

“Growth will slow further,” Louis Kuijs of Oxford Economics said in a report.

Chinese leaders are trying to steer the economy to more sustainable growth based on domestic consumption instead of exports and investment and to reduce financial risk.

Construction and housing sales, an important source of demand for steel, copper and other industrial imports, have slowed since regulators ordered developers to reduce their debt levels.

One of the biggest, Evergrande Group, is struggling to avoid defaulting on $310 billion owed to banks and bondholders. That has fueled fears about other developers, though economists say the threat to global financial markets is small.

Factories in some provinces were ordered to shut down in mid-September to avoid exceeding official goals for energy use and energy intensity, or the amount used per unit of output. Some warned deliveries of goods might be delayed, raising the possibility of shortages of smartphones and other consumer products ahead of the Christmas shopping season.

Factory output barely grew in September, expanding by only 0.05% compared with August. That was down from the 7.3% growth for the first nine months of the year.

Private sector forecasters have cut their growth outlook this year for China, though they still expect about 8%, which would be among the world’s strongest. The ruling Communist Party’s official target is “more than 6%,” which leaves Beijing room to keep its controls in place.

The near-term outlook “remains difficult," said Rajiv Biswas of IHS Market in a report. Real estate also is suffering from “fears of contagion to some other property developers.”

This year’s economic figures have been exaggerated due to comparison with 2020, when factories and stores were closed to fight the coronavirus.

Output grew by a record 18.3% in the first quarter of 2021, but forecasters said the rebound already was leveling off.

In September, growth in retail spending weakened to 4.4% over a year earlier, down from 16.4% in the first nine months.

Investment in real estate, factories, housing and other fixed assets rose 0.17% in September, down from 7.3% for the first nine months.

The latest figures indicate “the property sector fallout will be a significant drag on growth in the coming quarters,” said Fidelity’s Mo. “Even significant policy easing now, which is still unlikely in our view, will take time to propagate into the real economy.”

Auto sales in the global industry’s biggest market fell 16.5% in September from a year earlier, according to the China Association of Automobile Manufacturers. The group said production was disrupted by shortages of processor chips.

Imports, an indicator of Chinese domestic demand, rose 17.6% in September over a year earlier, but that was about half the previous month’s 33% growth.

Hexo CEO Sebastien St-Louis leaves cannabis company amid reorganization

Hexo CEO departs

Hexo Corp. says Sebastien St-Louis, the cannabis company's co-founder and chief executive, is leaving the company, effective immediately.

The change comes as the company completes a strategic reorganization.

HEXO also says chief operating officer Donald Courtney has resigned, though he will remain until a replacement is found.

St-Louis says building Hexo has been the highlight of his career and that as a significant shareholder he looks forward to the company's next stage.

Hexo says it is in advanced talks and expects to make an announcement on a new CEO in the coming days.

The company has made several acquisitions this year, including deals to buy cannabis producer Redecan, 48North Cannabis Corp. and Zenabis Global Inc.

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