Sara Lee said it will sell three household and body care units in Europe as well as a large part of another unit in Australia in order to save $125 million by the end of fiscal year 2000. Sara Lee also said it closed its sale of Turtle Wax car care operations and sold its stake in Electrolux, helping the company save an additional $75 million.
The money will be used for a minimum $3 billion stock buyback by the end of its 2000 fiscal year, the company said in a statement.
The news pushed Sara Lee shares up 2 3/8 to 52 1/2.
Sara Lee, the parent of Sara Lee food products, Hanes hosiery and Playtex feminine care products, among others, said it wants to reduce the number of European factories to nine by the end of fiscal year 1999. The company had 26 plants in 1995.
To complete its goal, Sara Lee is selling two plants in Segrate and Trieste, Italy, which make bath and shower foams, hand creams, baby care products and toiletries.
The company said it will continue marketing the products under their brand names like Sanex and Williams. The majority of employees at the Italian plants will be able to keep their jobs at the facilities, Sara Lee said.
The company also said it is selling its aerosol production facility in St. Truiden, Belgium, as well as a "significant portion" of its household and body care business in Clayton, Australia. Sara Lee did not comment on job cuts at those factories.
Written By Tiare Rath