Sara Lee Looks to Sell Household and Personal-Care Unit
Sara Lee announced that it is reviewing strategic options for its International Household & Body Care business, which employs about 8,000 people world-wide. The Journal reported earlier this month that the company hired Goldman Sachs to sound out possible bidders for the business, which could fetch more than $2 billion.
Ralcorp’s frozen bakery Chief Richard Scalise resigns
RalcorpHoldingsInc. said Monday that the president of its frozen bakery products division, Richard Scalise, has resigned.
Scalise will step down April 3 to pursue “opportunities with another food company,” Ralcorp said in a news release.
Kevin Hunt, co-chief executive officer and president of Ralcorp, will assume Scalise’s position in addition to his other responsibilities.
St. Louis-based Ralcorp Holdings Inc. (NYSE: RAH) manufactures private label food products, including frozen bakery products, cereals, crackers, cookies, dressings, syrups, jellies, sauces, snack nuts and candy. The company bases one of its largest production facilities in Louisville at its Bakery Chef operations, which is part of the frozen products division
|
Which Consumer Goods Companies are Admired Most? | |
|
This week, Fortune magazine revealed the results from its "World's Most Admired Companies" survey, which asked business people to vote for the companies that they most highly regarded across multiple industries. Johnson & Johnson, Procter & Gamble and Coca-Cola were among the eight consumer goods companies to make the list. Find out which other consumer goods companies made the cut. Click here to view Fortune magazine's full 50 most admired companies list. http://money.cnn.com/magazines/fortune/mostadmired/2009/full_list/ | |
The succession race at Procter & Gamble Co. narrowed with Monday's exit of Susan Arnold, clearing the way for rival Robert McDonald to emerge as the front-runner to lead the world's biggest consumer-products company when Chief Executive A.G. Lafley retires.
Ms. Arnold, who turned 55 years old Sunday, said she was stepping down as president of P&G's global business units after a nearly three-decade career at the Cincinnati-based company. Ms. Arnold had known for some time that she was unlikely to succeed Mr. Lafley, but the CEO persuaded her to remain in senior management for a while, said a person familiar with the situation.
Over the past year, speculation about who will succeed Mr. Lafley has heated up, as the 61-year-old CEO nears P&G's normal retirement age of 65 and almost a decade in his post. Since at least 2006, Ms. Arnold and Mr. McDonald, the two most powerful executives at P&G after Mr. Lafley, had been in a horse race to become the next CEO, people close to the matter said.
Mr. McDonald, P&G's chief operating officer, has played a more visible role lately at investor conferences, giving Wall Street the impression he had the edge for the top job. But the global economic downturn could yet throw a curveball at P&G's succession planning.
Mr. Lafley recently has brushed aside notions that he might step down anytime soon. When asked about his retirement at an analyst conference in December, he told the crowd, "The rumors of my passing are greatly exaggerated," adding, "We're going to stay together, and we have a lot left to do."
The recession is proving particularly difficult as P&G's premium-priced staples, which range from the Olay line of skin-care products to Pampers diapers, face mounting competition from private-label products and other less-expensive brands. Investors, who have traditionally regarded P&G as a safe, defensive stock to own during difficult economic times, have sent its shares down nearly 30% this year to a 52-week low of $43.93 in intraday trading Monday. The stock later recouped some of its losses to finish 4 p.m. composite trading on the New York Stock Exchange at $44.18, down $1.53, or 3.4%.
Given the tough backdrop, P&G's board might ask Mr. Lafley to stay on until he turns 65, according to a person familiar with the situation. If he does, the 55-year-old Mr. McDonald would be 59 by that time, and P&G might regard him as too old to take the reins, given its history of preferring CEOs to serve about a decade.
Another possible scenario: given the volatility of current business conditions, Mr. McDonald could make a mistake that would prompt the board to look to one of P&G's several young vice chairmen and presidents, this person said.
Sanford C. Bernstein analyst Ali Dibadj suggested those contenders could include Edward Shirley, vice chairman of global beauty and grooming, Robert Steele, vice chairman for global health and well being, and Dimitri Panayotopoulos, vice chairman for global household care.
P&G declined to be specific about its succession plans. "A.G. is very focused on his role as chairman and CEO," a company spokesman said of Mr. Lafley, noting the company has "a deep bench" of leadership talent. "We have a rigorous approach to the CEO succession process to ensure a seamless transition."
Neither Ms. Arnold nor Mr. McDonald was available to comment.
Like Ms. Arnold, Mr. McDonald has spent his entire corporate career at P&G. He graduated from the U.S. Military Academy at West Point and joined P&G after serving five years as a U.S. Army captain. He rose up the ranks at P&G by working for its core businesses: fabric and home-care brands.
As P&G became more global in its outlook, Mr. McDonald was one of the first rising young stars it sent to prove himself in a foreign market. He spent the 1990s in Asia, overlapping with Mr. Lafley's leadership there. While known for his modesty and intense self-discipline, Mr. McDonald can also lay claim to a motivational leadership style and a penchant for story telling.
Over the past several months it appeared that Ms. Arnold had been looking outside P&G to heighten her professional profile. In 2008, she joined the board of McDonald's Corp., following her appointment as a Walt Disney Co. director the year before.
"There was a most clear push of momentum to Bob McDonald that the company was trying to signal to the Street," said Sanford Bernstein's Mr. Dibadj. "Even at the analyst day [in December], Susan Arnold took a step back and did a sustainability presentation," he said. Mr. McDonald, by contrast, gave a broad overview of the company's plans to expand and cut costs.
P&G didn't name a successor to Ms. Arnold. The executives who had reported to her now will report to Mr. Lafley, "reducing a layer of management as part of the company's ongoing simplification effort," P&G said. It said Ms. Arnold will relinquish her role as president immediately but continue with the company on special assignment until September. "It has long been her intention to step down upon her 55th birthday," the company said.
As published in the Wall Street Journal by Ellen Byron and Joann S. Lublin—Anjali Cordeiro contributed to this article.
Susan Arnold, president of global business units for Procter & Gamble Co., is resigning, the company said Monday.
Ms. Arnold, who turned 55 years old Sunday, had long been considered a contender to succeed 61-year-old P&G Chief Executive Officer A.G. Lafley, who is expected to step down when he turns 65. Ms. Arnold's departure could clear the way for Robert McDonald, currently P&G's chief operating officer, to succeed Mr. Lafley.
P&G said that Ms. Arnold will step down as president immediately, but she will continue with the company on special assignment, reporting to Mr. Lafley, until September, when she will have been with the company for 29 years.
"It has long been her intention to step down upon her 55th birthday," the company said.
Over the past several months it appeared that Ms. Arnold had been looking outside P&G to heighten her professional profile. In 2008, she joined the board of McDonald's Corp., following a board appointment at Walt Disney Co. the year before. A participant in the Clinton Global Initiative, the charitable organization led by former President Bill Clinton, Ms. Arnold has convened with world leaders and other high-profile executives to discuss issues such as poverty and sustainability at the group's annual conferences.
As the head of P&G's global business units, Ms. Arnold had overseen more than 300 brands, which in total generate $83.5 billion in annual sales. P&G didn't name a successor to Ms. Arnold, and the executives who have reported to her will now report to Mr. Lafley, "reducing a layer of management as part of the Company's ongoing simplification effort," the company said in a prepared statement.
Lean Factories Find It Hard to Cut Jobs Even in a Slump
At a factory here that churns out plastic parts for everything from spray cans to blasting caps, laying off just one worker can be more trouble than it's worth.
The plant, owned by Cleveland-based Parker Hannifin Corp., has become so lean over the past decade that many assembly lines run with only a handful of highly trained workers.
So while mass layoffs have driven the U.S. unemployment rate to its highest in 26 years, Parker and other companies like it are responding to the slump in more surgical ways, mainly by cutting hours and shedding temporary workers.
"Because of productivity gains, every one of my people carries more dollars in sales today," says Donald Washkewicz, Parker's chief executive. In 2000, the average Parker worker represented about $125,000 a year in sales. Today, that figure tops $200,000. "If I need to cut back, I have to cut back fewer people to achieve the same goal."
Similar trims are taking place at each of Parker's nearly 300 factories. And to varying degrees, this is happening at thousands of other large and small factories across the U.S.
The selective cuts help explain a curiosity of this recession. The manufacturing sector is suffering a sharp contraction and has had to slash many jobs -- some 1.3 million, according to a Labor Department jobs report released Friday. But fewer positions have been eliminated than would be expected given the depth of the slump.
As of February, 14 months into this recession, manufacturers have cut payrolls about 9.4%. That's slightly less than the 9.5% cut 14 months after the start of the 2000 recession, when the economy was already recovering. The drop in production and orders, however, has so far been much worse this time around, indicating that companies have sought ways to cut back other than simply shedding workers. As of January, the latest figures available, U.S. manufacturers cut production 12.8% since the start of this recession, compared with just 2.6% at the same point after the last recession began.
The sheer speed of this downturn, and the fact that it hit many manufacturers after the economy as a whole was officially in recession, may have muted layoffs. A good chunk of the factory sector was still humming along until late last year, aided in part by strong exports. Manufacturers may also be trying to hold on to workers as long as possible, in the hope that business revives.
But deeper changes in manufacturing are also playing a role. A decade ago, most factories tended to do "batch" work, with large groups of employees churning out endless runs of the same pieces. Since many workers did identical tasks, it was easier for companies to cut people during downturns.
That kind of work, which employs more people and includes a larger share of less-skilled positions, has been steadily migrating to lower-cost locales overseas. In the U.S., companies now have new equipment and streamlined operations that require fewer, more highly trained people to make more goods. The sector lost 3.5 million workers -- one in five jobs -- between January 2000 and the start of this recession. Even as employment contracted, production in that same time period rose 10%.
"When you get down to where we are now, where manufacturing is less than 10% of the employed population, there just isn't that much more you can cut," says Kurt Karl, chief U.S. economist at Swiss Re. Mr. Karl says manufacturers are especially eager to hold on to workers who are trained to operate their increasingly sophisticated equipment.
At Parker's Spartanburg plant, five workers make the tiny plastic rings that become seals on aerosol cans. Each member of the group runs a different set of high-speed machines doing a distinct step, such as extruding long noodles of plastic, grinding them or cutting them into final product.
The group can curb production several ways short of layoffs. Two workers can complete the first two steps in one day, then the other three workers can finish those products the next day, essentially cutting everyone's hours by half. Or, all five can take whole days off together. But permanently pulling one or two of them out of the mix is far more difficult to accomplish, and could make it impossible for the line to operate efficiently.
Mr. Washkewicz, the Parker CEO, says the last thing he wants to do is lay off a worker he's spent money training: "You want to sustain those skills."
But cutting hours might not be a long-term solution. Mr. Washkewicz says during the recession that hit the U.S. in the early 1980s, he headed one of Parker's operations that cut back to four-day weeks in order to save jobs. It worked for a while. But after about three months, many people were struggling to pay bills on salaries that had been reduced by 20%. The company ultimately changed its approach, laying off workers and restoring those who remained to a fuller schedule.
Many of the current Parker workers whose hours have been cut say that they prefer it to losing their jobs entirely, but that they don't feel out of the woods yet. "I try not to worry about the economy," says Miriam Porter, one of the workers now taking two unpaid days off each month. However, she adds, "it is looking kind of bad."
The Spartanburg plant, which employs about 133 workers, is part of Parker's hydraulic-filter division, which has plants in several U.S. locations as well as overseas. In the 2000 recession, the division's sales fell about 7%, prompting layoffs of 22% of its work force. This time, sales are down substantially more -- the company declines to provide a specific percentage -- but only 5% of workers have lost jobs.
Last week, Parker announced a one-year salary freeze for its workers world-wide. When it comes to scaling back production, each part of the company is given broad leeway in how and whether to cut workers or their hours. As part of its announcement last week, Parker trimmed the hours and salaries of everyone at its Cleveland headquarters by 10% through the end of June. The pay cut for top executives, including Mr. Washkewicz, was even bigger, because it included reductions in incentive bonuses.
Parker isn't alone. The Labor Department reports that in February, manufacturing production workers spent an average of 39.6 hours a week on the job, down from 41.2 hours a week a year earlier. In a survey of chief financial officers conducted by Duke University and CFO Magazine last month, 55% of manufacturing firms said that they had reduced employee hours over the past month, compared with 30% for other firms. Over the next year, 58% of manufacturing firms said they planned to cut hours, compared with 32% for other firms.
Streamlined production and technological improvements also mean fewer jobs need to be cut in a downturn. In another section of Parker's Spartanburg plant, two long rows of machines churn out plastic tubes for blasting caps. The small explosive devices are used by construction and mining companies to clear debris. With demand down for blasting caps, Parker recently went from making them on two shifts to just one.
That move cost the jobs of two workers who ran those machines on a second shift. A decade ago, those same two blasting-cap lines required up to eight people to operate. Eliminating production on that second shift would have meant shedding four times as many workers. The labor-saving improvements included replacing nearly 400 mechanical rollers that required workers to painstakingly apply lubricant throughout the workday. Now the line has mechanisms that don't need oiling.
Another factor saving jobs thus far is smaller inventories. A decade ago, Parker, like many other companies, structured its factories so that workers were building large batches of goods at each stage of production. That often led to huge stockpiles and made it harder to adjust when a downturn hit. There might have been six months or more of goods on Parker's shelves before the signal finally came to reduce production.
Parker's plants today have been largely restructured to create smaller production clusters. Seals for aerosol cans, for example, are only made in numbers that match the flow of orders. Mr. Washkewicz says those big stockpiles of yesteryear used to mean he had to cut more people, much faster. "In the past, we were trying to adjust to past sins, as well as the current drop," he says.
Some companies say tighter inventories helped them notice a dropoff in orders more quickly than they might have in years past. "We saw the economy changing early last year and started cutting back," says Rick Olson, who oversees four of Toro Co.'s plants in the northern U.S.
Toro, based in Bloomington, Minn., makes lawn mowers and other equipment that traditionally sees lots of seasonal flux in sales. Rather than laying off workers in droves, the company curbed seasonal hiring and overtime and didn't replace workers who had left.
Some smaller companies have found ways to shrink head count since the last downturn. Germantown, Wis.-based Mahuta Tool Corp., which makes items such as 600-pound screws used in cranes, went from 23 to 12 workers in the last bruising manufacturing recession. This time, the company has only had to cut two workers, reducing its payroll to 17, in part because each worker now represents far more production than before.
"The highly skilled person, you're not going to lay them off," says CEO Lynn Mahuta. "You will find other work for them to do."
For workers who haven't been spared the ax, the future is an open question. Spurgeon Jackson, a 34-year-old machine operator who has spent 15 years at Parker's Spartanburg plant, was one of the two people laid off from the second shift making parts for blasting caps. He was recently called back to cover for a worker on medical leave, but he doesn't know how long it will last.
"The 2000 recession was bad," he says, stopping next to the clattering row of machines, "but not nearly as bad as things are right now."
As published in the Wall Street Journal by Timothy Aeppel and Justin Lahart
New Jersey-based drug makers Merck & Co. and Schering-Plough Corp. announced plans to combine in a $41.1 billion cash-and-stock deal that comes six weeks after rivals Pfizer Inc. and Wyeth unveiled their engagement.
The announcements come as the world's biggest pharmaceutical companies face a litany of pressures -- from product pipelines that likely won't be able to offset companies' blockbusters that will lose patent protection in the coming years to the potential of increased government pressure to lower prices. Merck and Schering-Plough already had a relationship through their cholesterol-drug joint venture, which has seen its sales slump.
The combined company will benefit from a formidable research and development pipeline, a significantly broader portfolio of medicines and an expanded presence in key international markets, particularly in high-growth emerging markets," Merck Chairman and Chief Executive Richard T. Clark said in a joint press release.
In discussing Merck's quarterly earnings last month, Mr. Clark had said the drug maker was open to buying a big rival, signaling a shift for a company that long maintained its research prowess was enough to keep it growing.
Mr. Clark would oversee the combined company, which will retain the Merck name. Three Schering-Plough board members would join Merck's board. Schering-Plough Chairman and Chief Executive Fred Hassan said he "intends to participate in the integration planning until the close."
In an interview, Mr. Clark said the integration is expected to result in a work-force reduction of about 15%, with a high percentage of the job eliminations happening outside the U.S.
Merck, of Whitehouse Station, N.J., has about 55,200 employees world-wide, with 28,000 in the U.S., according to a regulatory filing. Kenilworth, N.J.-based Schering-Plough has about 51,000 global employees, with just 15,000 in the U.S.
Both companies had been laying off employees even before the acquisition deal was struck. Like other major drug makers, they have been contending with lackluster sales growth, hurt by competition from generic drug makers and now the economic downturn.
"Of course when the market is in a mood of desolation, this is often the best time to effect a merger or acquisition," said David Buik of BGC Partners. He added the deal "seems to make huge sense with a cost-cutting exercise imperative, with the Obama administration hell bent on giving the drug companies a very hard time, offering the generic operators a brilliant opportunity."
Some $3.5 billion a year in cost savings are anticipated beyond 2011. Schering-Plough is expected to "modestly" add to Merck's earnings, excluding charges related to the deal, in the first year after its completion and "significantly" thereafter.
Under the deal, Schering-Plough shareholders would get 0.5767 share of Merck and $10.50 in cash for each share they own. That values Schering-Plough at $23.61 a share, a 34% premium to Friday's closing price. Merck shareholders would own 68% of the combined company.
In premarket trading, Schering-Plough jumped 18% to $20.80 while Merck fell 4.4% to $21.75. Mr. Buik noted that Schering-Plough shares advanced nearly 10% in a Friday afternoon rally.
Some 44% of the deal will be cash, with $9.8 billion coming from existing balances and $8.5 billion from committed financing from J.P. Morgan Chase & Co. Merck said its board is committed to keeping its dividend at current levels, which is triple the payment Schering-Plough holders now get. Merck's vow contrasts with Pfizer, which will halve its dividend, the yield of which had been the highest of the major drug makers.
Pfizer's deal for Wyeth, valued at $68 billion when it was unveiled in January, represents the largest takeover in the pharmaceutical sector since Glaxo Wellcome PLC acquired SmithKline Beecham PLC for $76 billion in 2000.
The two companies' cholesterol-drug joint venture has been under pressure for a year following an early 2008 study raised questions about the effectiveness of Zetia. The results sent prescriptions of Zetia and sister drug Vytorin, which combines Zetia with Merck's Zocor, plummeting.
Mr. Hassan took over Schering-Plough six years ago as chairman and CEO at a time when the company has dealt with manufacturing troubles which led to a $500 million fine. At the time, it was said taking over Schering-Plough would test his mettle as a turnaround expert.
Now while the company is in stronger financial shape, its stock sits at the same level it did when Mr. Hassan took charge amid 50% price drop the past 18 months.
Dannon appoints Gustovo Valle CEO
Gustavo Valle will be the new CEO and president of Dannon. He will replace Juan Carlos Dalto as head of the Danone Group subsidiary, based in White Plains, N.Y.
The Dannon Co., the yogurt marketer based in White Plains, has named a change in top management.
On April 1, Valle will become president and chief executive officer of the company, a subsidiary of Paris-based Groupe Danone. Valle, currently the CEO of Danone Brazil, will relocate to the White Plains area.
Valle started his career at Danone in Argentina in 1996 as vice president of finance. He eventually became CEO of Danone Waters in Argentina in 2002. In 2004, he became CEO of Danone Brazil.
Valle will replace Juan Carlos Dalto, who has decided to pursue a career in international strategic consulting in his home country of Argentina.
Procter & Gamble sells Infusium 23 brand to Helen of Troy
Personal care company Helen of Troy Ltd. has acquired Procter & Gamble Co.’s Infusium 23 hair care business, the company said Wednesday. The purchase price wasn’t disclosed.
P&G’s (NYSE: PG) Infusium 23 line is a global brand that includes shampoos, conditioners and hair treatments. It is marketed to hair-care professionals and consumers, according to a news release. The deal is expected to be completed by March 31.
The 84-year-old brand will be integrated into Helen of Troy’s Idelle Labs division, which also markets brands like Vitalis, Brut and Sea Breeze.
“We estimate that Infusium 23 will generate approximately $40 million in sales on an annualized basis with products that will be marketed into both retail and professional trade classes,” said Gerald Rubin, chairman, president and CEO of Helen of Troy.
Helen of Troy (NASDAQ: HELE), headquartered in El Paso, Texas, manufactures and markets personal care products, including hair dryers and hair-care accessories; and household products like kitchen tools and bar and wine accessories.
Farmer Bros. Completes $45 Million acquisition of Sara Lee's Direct-Store Delivery Coffee Business
Farmer Bros. Co. said Monday that it has completed its acquisition of Sara Lee Corp.'s U.S. direct-store delivery Foodservice coffee business for $45 million.
The acquisition, which is being financed with cash and a credit line from Wachovia Bank, makes Farmer Bros. the nation's largest direct-store delivery business for coffee and allied products, with service to all 48 mainland states.
Displaying Records 241 to 250 of 602
<< Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14
15 16 17 18 19 20 21 22 23 24 [25] 26 27 28 29
30 31 32 33 34 35 36 37 38 39 40 41 42 43 44
45 46 47 48 49 50 51 52 53 54 55 56 57 58 59
60 61 Next >>
Boutique executive search services with best in class global network, contacts and market mastery.
Deeply connected and engaged personal service approach, long-term investment in client community and 25 year history of strong relations with both Multi-National leaders and Private Equity partners.
