Consumer products and packaged food company Sara Lee Corp. (SLE) Monday said that it reviewing strategic alternatives for its International Household & Body Care business, including divesting the business, after receiving expressions of interest.
There were reports earlier that Sara Lee was mulling the sale of its European household and personal-care business, as the company seeks to reverse a sharp decline in its share price and focus on its core food and beverage business. The European household and personal-care business accounts for about 15% of the company's total sales.
The Utrecht, Netherlands-based segment manufactures and markets household and personal care products in more than 150 countries in Europe, Asia Pacific, Africa and North America. According to the company, the segment, which is a $2.3 billion business, employs about 8,000 people worldwide.
The segment's Household products include Air care, shoe care, insecticides and laundry care brands like Ambi Pur, Kiwi, Pyrel, Vapona, Biotex and Neutral. Body Care products include Bath & shower, deodorants, baby care, men's toiletries and oral care brands like Sanex, Duschdas, Radox, Zwitsal, Brylcreem, Prodent and Zendium.
A Wall Street Journal report said that the company has hired Goldman Sachs Group Inc. (GS) to find out possible buyers for the business, which could fetch over $2 billion. As per the report, the prospective bidders could be consumer goods giant Unilever Plc (ULVR.L, UL, UN) or cleaning products maker Reckitt Benckiser Plc (RB.L, RKBKF.PK) of Britain. The possible bidders from the U.S. include Wisconsin-based cleaning products maker S.C. Johnson & Son Inc. and New York-based consumer products maker Colgate-Palmolive Co. (CL).
For the recently concluded second quarter, Sara Lee reported a net loss, hurt by charges. The company's net loss for the quarter was $17 million, or $0.02 per share, compared with a net income of $182 million, or $0.25 per share, last year. Net sales declined to $3.34 billion from $3.41 billion in the prior-year quarter. International Household and Body Care recorded a 15.7% dip in net sales, due to unfavorable foreign currency exchange rates and lower unit volumes, reflecting worsening economic conditions in key European markets.
In December 2008, Sara Lee had announced a plan to cut 700 jobs and outsource its business transaction processing as well as applications development and maintenance services. Before that, in November last year, the company had proposed to close its kosher hot dog and meat processing facility in Chicago on or before January 30, 2009.
SLE is trading at $8.15, down $0.10, on a volume of 1.52 million shares.
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