Sara Lee Says CEO Barnes Recovering From Stroke Suffered `a Few Weeks Ago'
Barnes, 56, has been on medical leave since May 14. Marcel Smits, executive vice president and chief financial officer, has been serving as interim CEO of the Downers Grove, Illinois-based food company.
“I suffered a stroke a few weeks ago, and I am now in the process of recuperating,” Barnes said today in a company statement. “I’m pleased to see how effectively our interim team is performing in executing our ongoing strategy and moving the company forward during my absence.”
Smits, acting Chairman James Crown and Christopher John Fraleigh, CEO of North American retail and food service, are overseeing the company’s operations including the sale of Sara Lee’s international household-products businesses, a company spokesman, Jon Harris, said in a May 14 interview.
“We know what the situation is, but it’s still not clear if she will return or when,” said analyst John Baumgartner at Telsey Advisory Group in New York in a phone interview. “I have been telling investors that Marcel is well equipped for the job whether it’s temporary or permanent.” His 12-month target price is as much as $19 per share.
Sara Lee spokesman Mike Cummins said today in an interview that Barnes suffered the stroke “just before” the May 14 announcement of her medical leave. He declined to comment on Barnes’ condition, or whether she was recuperating at home or in a hospital.
Sara Lee, which markets the Jimmy Dean, Hillshire Farm and Ball Park meat brands, has agreed to sell its body-care business to Unilever and its air-freshener business to Procter & Gamble Co. for a combined 1.59 billion euros ($1.95 billion), to focus on food and beverages. The company has said both transactions will close this year.
The Unilever sale will be reviewed in greater detail by the European Commission to determine the deal’s full impact in some markets. The London- and Rotterdam-based company said May 25 that it now expects the purchase to be completed in the fourth quarter, later than the third-quarter schedule previously announced.
Analyst Timothy Ramey of D.A. Davidson & Co. in Lake Oswego, Oregon, said in a June 11 note to clients that Smits might be looking for acquisitions to expand Sara Lee’s coffee and meat businesses. Ramey recommends holding the shares.
“We’re certain that Sara Lee would do a deal in meats if the right opportunity surfaced,” Ramey said, citing Kraft Foods Inc.’s Oscar Mayer brand and closely held Boar’s Head Provisions Co. as possible targets. Kraft spokesman Michael Mitchell declined to comment. A spokeswoman for Sarasota, Florida-based Boar’s Head didn’t immediately return a call seeking comment.
Sara Lee rose 15 cents to $14:78 at 4:15 p.m. in New York Stock Exchange composite trading. The stock has increased 21 percent this year.