ConAgra Foods plans to divest refrigerated meats businesses
The combined annual sales for the businesses being offered for sale are about $1.9 billion.
06/02/06 ConAgra Foods Inc., one of North America's leading packaged food companies, announced plans to divest most of its refrigerated meats businesses, including the Armour, Butterball, and Eckrich brands. In addition, the company announced several changes designed to streamline its operating structure, including moving its Grocery Foods headquarters from Irvine, Calif., to Naperville, Ill., and further centralizing its shared services.
"Our actions today reflect our commitment to simplify operations and to concentrate in areas where we have the strongest competitive positions," said Gary Rodkin, ConAgra Foods president and chief executive officer. "They put us in a much better position to execute and drive consistent and sustainable growth."
The combined annual sales for the businesses being offered for sale are about $1.9 billion. The businesses include Armour meats and hot dogs, Butterball turkey, and Eckrich smoked sausages, hot dogs and lunchmeats. These processed meat products are sold to retail grocers, delis, restaurants and other foodservice establishments. Luis Nieto, president, Packaged Meats and Deli, will continue to lead the combined meats business during the sale process, which is expected to take 10-12 months. The company will continue to manufacture, sell, promote and deliver these quality products with the highest levels of customer service during this period, and work to assure uninterrupted service through transition to new ownership.
Neither the company's Healthy Choice brand of meat, nor its Hebrew National, Brown 'N Serve, Slim Jim, and Pemmican businesses are included in the assets for sale. Last week Smithfield Foods, Inc., signed a definitive agreement to acquire substantially all of the assets of the company's Cook's ham business.
"ConAgra Foods has a number of great brands and businesses to drive future growth. We will build on those strengths by coupling disciplined investments in well-positioned brands with a more streamlined operating structure," said Rodkin.
Consistent with that logic, ConAgra Foods announced the realignment of various operations:
- The company's Retail and Culinary Products businesses will be combined to form Consumer Foods. It will manage all consumer brands and foods that are sold by ConAgra Foods to retail and foodservice customers, as well as manage the company's international consumer foods business. Dean Hollis, president and chief operating officer, Consumer Foods, will oversee these businesses, which include Dairy, Frozen, Grocery, Packaged Meats and Deli, Snacks, Store Brands, and International. Greg Heckman, president and chief operating officer, Commercial Products, will oversee the company's Lamb Weston brand of potato products, ingredients brands such as ConAgra Mills, Gilroy Foods and Spicetec, seafood brands such as Louis Kemp, Meridian and Singleton, as well as the ConAgra Foods Trade Group's trading, merchandising and risk management operations.
- The ConAgra Foods Sales organization will assume responsibility for both retail and foodservice customers, with current personnel in culinary foodservice sales joining the company's centralized selling organization. Doug Knudsen, president, ConAgra Foods Sales, will oversee the combined ConAgra Foods sales organization.
- The company's Grocery Foods headquarters will move from Irvine, Calif., to Naperville, Ill. which is currently the headquarters of its dairy and meats businesses. Grocery, which manages the company's shelf-stable products, such as Hunt's, PAM, and Chef Boyardee, will transition people to Illinois by June 1.
- A number of people in shared functions across the company, including product quality and development, sales and operations planning, and transportation and warehousing management, will be relocated to Omaha, Neb., to drive increased collaboration, functional excellence and efficiency.
ConAgra Foods Inc. is one of North America's largest packaged food companies, serving grocery retailers, as well as restaurants and other foodservice establishments. Popular ConAgra Foods consumer brands include: Banquet, Chef Boyardee, Egg Beaters, Healthy Choice, Hebrew National, Hunt's, Marie Callender's, Orville Redenbacher's, PAM, and many others.
