Sara Lee Corp. (SLE) recently indicated that it has completed the sale of its 51% stake in Godrej Sara Lee Joint Venture to Godrej Consumer Products Ltd. in consideration for $230 million, putting an end to the 15-year old partnership. Godrej Sara Lee will now be known as Godrej Household Products.
Godrej Sara Lee has been the market leader in household insecticides such as Good Knight mosquito repellent and Hit. In fiscal 2009, the Joint Venture generated approximately $158 million in sales.
Sara Lee is also selling its global body care and European detergents businesses to Unilever (UL) and its air care business to Procter & Gamble (PG). The Unilever deal is expected to end by calendar-year 2010 and the Procter & Gamble deal is expected to close shortly after the end of the fiscal year in July.
The disposal of Sara Lee’s body care, European detergents, air care and Indian insecticides business leaves only the shoe care, non-European cleaning brands, and non-Indian insecticides businesses to be sold in its divestiture plan for the entire International Household and Body Care business segment.
All these divestitures will aid Sara Lee to streamline its focus more on the food and beverage business. Furthermore, the company intends to enhance shareholder return by using the proceeds to repurchase shares.
The spate of divestitures in the non-core assets would also augment the company’s growth via the strategic investment of these proceeds including accretive acquisitions.
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Read the full analyst report on “UL”
Read the full analyst report on “PG”
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