ROANOKE TIMES
Copyright (c) 1997, Roanoke Times
DATE: Tuesday, March 11, 1997 TAG: 9703110089
SECTION: BUSINESS PAGE: B-6 EDITION: METRO
DATELINE: PITTSBURGH
SOURCE: ASSOCIATED PRESS
The restructuring plan may include eliminating 6 percent of Heinz's work force of 43,000.
With H.J. Heinz Co. poised to announce a restructuring plan said to include 2,580 layoffs, analysts are speculating about which businesses the baby food, ketchup and tuna company will unload.
Some say the processed food giant may slim down by shedding Weight Watchers, but chairman Anthony J.F. O'Reilly is known to be sour on pickles. He once said staying in the pickle business was a mistake.
The restructuring plan, details of which will be disclosed on Friday, will include eliminating 6percent of Heinz's work force of 43,000, The Wall Street Journal reported Monday.
The report said factories in North America and Europe will be closed, but it did not say where or when layoffs would occur.
The food concern also plans to sell businesses accounting for as much as $600 million of its $9.1 billion in revenue in the coming year, the newspaper quoted unidentified sources as saying.
Company spokeswoman Gail Stull declined to say which businesses will be targeted in the restructuring plan, which will be completed by the board Wednesday.
On the reports, Heinz stock initially rose 2.6 percent on the New York Stock Exchange, climbing $1.12 1/2 to $44.87 1/2 a share in early morning trading. It fell back some, rising 25 cents to $44 a share in late afternoon.
John M. McMillin, a food-industry analyst for Prudential Securities, suggested Heinz should put Weight Watchers on the block because the diet-food maker hasn't kept up with ``the new, exercise-oriented America.''
O'Reilly, the company's chairman, may have other things in mind.
Last September, he told The Associated Press that holding onto the pickle business was one of his biggest mistakes as chairman.
``We were bewitched by it,'' he said. ``We should have reduced our pickles substantially a long time ago.''
He said the company holds a small share of the market for pickles. Most households, he said, buy only a single jar a year.
O'Reilly also said last fall that the company planned to sell some product groups and pare the company to six core businesses: ketchup and condiments, baby food, pet food, tuna, Weight Watchers diet foods, and food service, which includes baked goods, frozen soup and Ore-Ida frozen french fries.
Heinz also is slated this week to name several companies targeted for acquisition, including the Polish ketchup company Pudlitzky and an unidentified ketchup company in Asia.
The company is also expected to reveal that it will take a pretax charge of more than $500 million in its fiscal fourth quarter, which ends on April 30.
O'Reilly has suggested he will stay as chairman for at least two more years.
LENGTH: Medium: 62 lines ILLUSTRATION: PHOTO: ASSOCIATED PRESS. Steam billows from the Heinz plant inby CNBPittsburgh Monday. Big changes are in the works at Heinz. color.