In line with Sara Lee’s plan of revamping the company, it is currently looking at selling its struggling North American bakery and bread business. Sara Lee, famous for producing Jimmy Dean foods, hopes that this move would bring about a broader change for the company.
Sara Lee, a major player in the food industry, has been courting possible buyers of the bread unit, which has been seeing dwindling sales throughout the recession, according to sources that refused to be mentioned, for this matter isn’t public. The company has obtained the services of Bank of America, Corp to get financial advice on the bakery unit, which includes one of the largest fresh bread brands in the country.
The formal transaction process hasn’t started and advisers have only begun to focus on interest from private equity funds.
Over the last decade, Sara Lee has been constantly developing the expansion of the unit. The company started with closing a $2.8 billion deal to acquire Earthgrains in 2001, and then a $72 million deal to obtain Butter Krust Baking in 2006. However, due to tighter competition, the bakery division encountered challenging times. Eventually, its profit and sales significantly dropped. In February 2010, company CEO Marcel Smits announced to investors that the bakery business isn’t the company’s main source of profit.
More info:
http://www.thestreet.com/story/10812216/1/sara-lee-examines-sale-of-bakery-unit.html?cm_ven=GOOGLEFI
http://articles.chicagotribune.com/2010-07-20/business/ct-biz-0721-sara-lee-bread-20100720_1_bakery-sales-sara-lee-bread-business
