PITTSBURGH (AP) _ H.J. Heinz Co. said Tuesday it plans to trim European operations and sell off a host of brands for an estimated $1 billion in a move to focus operations on its ketchup and other core products.
The Pittsburgh-based company said it plans to sell businesses accounting for about $1.4 billion in yearly sales, including its seafood, vegetable and frozen-food businesses in Europe and its Tegel poultry unit in New Zealand. Following these sales, the company's European operations would generate annual sales of $2.5 billion, or 30 percent of overall revenue. The changes are similar to actions the company previously took in North American and Australia.
Heinz has hired UBS AG and JPMorgan Chase & Co. to help it sell the assets. Proceeds will be used for stock repurchases and debt reduction, the company said.
Following the restructuring, the company will focus on three areas: ketchup, condiments and sauces; meals and snacks; and infant nutrition.
``Heinz is becoming an even more attractive investment opportunity as we focus on three strong categories where we have the consumer expertise, the leading brands and operational capabilities to generate stronger and higher quality growth in profits and sales,'' said William R. Johnson, president and chief executive officer.
At a meeting with analysts Tuesday, Heinz also plans to discuss improving its business and distribution systems. Heinz is moving to an integrated, rolling 24-month planning system, which it says will improve demand forecasting and help with new product introduction and promotion planning.