by Christopher Freeburn | June 6, 2012 9:53 am
Sara Lee (NYSE:SLE) won’t be Sara Lee any longer. The food products company is spinning off its European business and changing the name of its North American operations to Hillshire Brands.
Company officials announced the new name on Tuesday.
For consumers, the change may not mean much. Popular confections with the Sara Lee name sold in grocery stores are mostly manufactured by other food companies. Sara Lee has gradually divested those products in recent years as it turned its focus to deli meats and convenience foods, the Wall Street Journal noted.
Later this month, the company’s coffee and tea business in Europe will become a separate company operating under the name D.E. Master Blenders 1753.
U.S. sales of Hillshire-branded meat products have weakened in recent years and the company is preparing to refocus its efforts on reviving the brand name.
The company attributes Hillshire sales declines to poor management of company franchises. It plans to increase North American meat-product revenues by between 4% and 5% within three years by adding new products and updating its marketing. It also hopes to pare costs by $100 million.
Hillshire products include Ball Park hot dogs and Jimmy Dean sausages.
Analysts cited by the Journal likened the changes to a “furious rearrangement of deck chairs,” saying the company was in decline and didn’t have a turnaround strategy.
Sara Lee shares slipped by less than 1% in early Wednesday trading.
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