Sara Lee will add $250 million to its marketing and R&D budgets as part of a turnaround plan announced last week.
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| Brenda Barnes |
Sara Lee plans to spin off its $4.5 billion North America apparel business and sell $3.65 billion worth of other business to focus on its core bakery, meat and coffee brands.
Sara Lee has promoted Brenda Barnes to CEO from president, effective last week. Sara Lee recruited the PepsiCo veteran last year to groom her to replace CEO Steven McMillan, who stays on as chairman through October to oversee divestitures, including retail coffee and household products. Sara Lee Foods CEO Robert Kopriva retires in June.
The Chicago-based company will form three geographic divisions to organize its business operations around consumers and retail and foodservice customers. The changes take effect July 3.
North American Retail, a $4.5 billion unit, includes bakery, packaged meats and Senseo coffee retail businesses in North America. Sara Lee’s new Chief Customer and Marketing Officer CJ Fraleigh (a Pepsi veteran, and former general manager for General Motors’ GMC-Buick-Pontiac unit) leads Sara Lee’s North American Retail division. Sara Lee will keep Senseo but plans to sell off its other retail coffee brands, Chock full o’Nuts, Hills Bros., MJB and Chase & Sanborn.
North American Foodservice, a $2.2 billion unit, includes bakery, coffee and meats foodservice in North America. PepsiAmericas, Inc. VP-U.S. Operations James Nolan joins Sara Lee on Feb. 21 to oversee the foodservice unit.
Sara Lee International, a $4.6 billion unit, includes bakery and beverages outside North America; European packaged meats; and household products globally, which likely will be sold. Adriaan Nühn, Sara Lee’s current head of global beverages and household products, will lead the International division.
“We will concentrate our financial and management resources on a smaller number of business segments where we are well-positioned for substantial growth,” Barnes said in a statement. “As a result, Sara Lee will undergo a significant portfolio change, pursuing the disposition of our businesses that do not fit with our strategic focus within the food, beverage or household products categories.”
Sara Lee plans to sell off its $1.1 billion European meats business; its $450 million direct-selling business (outside the U.S.) and its $1.8 billion European apparel business. It will spin off the rest of its apparel business into a stand-alone, publicly traded company with the strong Hanes, Champion, Playtex, Bali and Just My Size brands. Sara Lee Bakery Group CEO Richard Noll becomes president-chief operating officer of the apparel spin-off.
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