ROANOKE TIMES
Copyright (c) 1995, Roanoke Times
DATE: Friday, December 22, 1995 TAG: 9512220038
SECTION: BUSINESS PAGE: C-7 EDITION: METRO
DATELINE: CHICAGO
SOURCE: Associated Press
Quaker Oats Co.'s troubled Snapple beverage line will undergo a $30 million restructuring in a bid to lift the once top-selling drinks business out of a financial funk.
Quaker, whose products include Gatorade and Cap'N Crunch cereal, also said Thursday it will work to improve lagging European beverage and Pacific food sales, using about $10 million of a $40 million second-quarter pretax restructuring charge to that effect.
Snapple has been an albatross for Chicago-based Quaker since it bought the company in November 1994 for $1.7 billion - a price most analysts considered too high.
``They not only paid too much for Snapple, but their timing was extremely poor,'' said analyst William Leach at Donaldson, Lufkin & Jenrette. ``They bought it literally the day it was going into decline, and it has been going downhill ever since.''
The Chicago-based company said it expected to report a loss of 35 cents to 45 cents a share for the three months ending Dec. 31, primarily because of a $55 million operating loss for the weakening Snapple line.
``We have identified five areas as critical for enabling profitable growth for Snapple, including greater management focus, enhanced distribution and marketing execution capabilities, aggressive new marketing-advertising'' and developing new systems to track manufacturing and selling, said Quaker chairman William D. Smithburg.
LENGTH: Short : 37 linesby CNB