Sara Lee chooses name for North American meat business

US consumer goods company Sara Lee, which is planning to split into two publicly traded companies by the end of June 2012, has chosen Hillshire Brands Company as the new name for its North American business.

According to Sara Lee, the new name was inspired by the Hillshire Farm brand, which was acquired in 1971. Previously, the company already announced DE Master Blenders 1753 as the new name for its coffee and tea business.

Following the split on 28 June 2012, Hillshire Brands will focus on meat-centric food products and foodservice operations, while DE Master Blenders 1753 will focus on international coffee and tea business.

Hillshire Brands will be listed on the New York Stock Exchange and carry the ticker symbol HSH, offering several consumer brands such as Jimmy Dean, Hillshire Farm, Ball Park, Aidells, Gallo Salame and State Fair.

Hillshire Brands’ Foodservice division will however continue to be known as Sara Lee Foodservice, offering meat and bakery items.

Sara Lee North American retail and foodservice CEO Sean Connolly said the management plans to make Hillshire Brands an innovative meat-centric food company in the US.

"We begin life in a dynamic sector as a major player with four iconic mainstream meat brands – Jimmy Dean, Ball Park, Hillshire Farm and State Fair – and our two artisanal brands – Aidells and Gallo," Connolly added.

Sara Lee has also outlined four strategies to drive profitability of Hillshire Brands, which include boosting revenues through innovation and brand support, improving gross margins through higher-margin products, increasing marketing, advertising, and promotion (MAP) to 5% of revenue by fiscal year 2015, and implementing a three-year cost and productivity plan to save $100m.

Sara Lee also noted that the strategy is expected to lead to 4%-5% increase in annual revenue, 10% growth in operating margin by fiscal year 2015, and a near-term dividend payout ratio of 30%-35%.

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Image: Sara Lee will split into two independent companies on 28 June 2012 with Hillshire Brands focusing on meat-centric food products and foodservice operations in North America. Photo: Sara Lee.