COMMENT: Global bakery is not Sara Lee's bread and butter
Deodorant and hair gel are not common topics on just-food but Sara Lee's deal to sell brands including Sanex and Brylcreem has thrown up some interesting questions for the US group's food business.
Sara Lee's US$1.28bn deal with fellow consumer goods group Unilever - struck after months of looking for a buyer - will allow it to plough cash into key food and beverage businesses.
The US group also claimed it had received "significant interest" in household brands, including shoe polish and air fresheners, so a sale there seems imminent.
What could this spring clean mean for Sara Lee's food portfolio?
Its North American retail operations - including Jimmy Dean and Hillshire Farm meats - and its international beverage division - containing brands like Douwe Egberts coffee - look set for a windfall.
Earlier this month, while addressing analysts in the US, Sara Lee boss Brenda Barnes marked its North American retail and international beverage businesses as "high priority" for capital investment.
Tea and coffee outside the US was also labelled as "high priority" in terms of M&A ambitions.
Elsewhere, Sara Lee's fresh bakery business in North America looks safe. However, there are indications that the group's international bakery operations could be next on the block.
In the same presentation, Sara Lee's international bakery business, which includes operations in Spain and Australia, were marked as "low priority" for capex and M&A spending.
Sara Lee's international bakery business has endured a challenging 12 months. Revenue from the division inched up by 1% in Sara Lee's last fiscal year and, in July, the company agreed to sell three bakeries in Spain amid fierce local competition from private label.
Sara Lee has seen underlying profits from its international bakery division tumble 14% in the last three years - the worst performance of any of its units. Sales growth from the division is the lowest throughout the Sara Lee empire.
Sara Lee is looking to exit "non-core" businesses and nothing screams "non-core" as much as tumbling profits, stagnant sales and being low priority for capex and M&A.
A Sara Lee official today insisted the company still had "plans" for international bakery - but then swiftly directed us to Barnes' presentation from two weeks ago.
Could international bakery be the next division to be sliced from the Sara Lee portfolio?
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