Heinz Offers Buyouts to Pittsburgh Staff Shunning Culture

HJ Heinz Co. is offering buyouts in Pittsburgh, the city it has called home for more than a century, as its new owners overhaul the company’s culture and press for cost savings.

The ketchup maker was taken private last year by Warren Buffett’s Berkshire Hathaway Inc. and Jorge Paulo Lemann’s 3G Capital in a $23.3 billion deal. Since then, Chief Executive Officer Bernardo Hees has eliminated thousands of jobs, announced factory closures in North America and instituted policies that encourage belt-tightening, such as pulling the plug on mini fridges at the office.

“Heinz realizes that its new dynamic and results-driven culture, focused on efficiency and meritocracy, may not be the perfect fit for every employee,” Michael Mullen, a spokesman for the company, said today in an e-mail. Because of that, the business is providing “enhanced severance benefits” to eligible employees, he said.

Workers were offered a minimum of six months of pay, and can receive more depending on their tenure, Mullen said. The program is voluntary and available to all who have been at the company at least a year, he said.

“Heinz remains steadfast in our commitment to Pittsburgh,” Mullen said, and plans to fill any vacancies created.

Staffing worldwide fell to less than 29,000 as of Dec. 29, from 31,900 eight months earlier, regulatory filings show. There are 775 workers in Pittsburgh, Mullen said.

The food company was founded in Sharpsburg, a suburb of Pittsburgh, in 1869 and moved to the city in 1890, according to the Associated Press, which reported the buyout offers earlier today. The stadium where the National Football League’s Steelers play, is named Heinz Field.

Buffett’s Model

3G is in charge of operations and has instituted policies that echo its management style at other businesses it runs. Hees previously oversaw Burger King Worldwide Inc. for Lemann’s firm. Berkshire and 3G each own half of Heinz’s common equity.

Buffett has said the arrangement, in which he provided financing while allowing partners to run the business, could be a model for future takeovers.