NEW YORK (B)--Sara Lee Corp., the sausage-to-silk-stockings conglomerate, said it is selling off operations with more than $4 billion in annual sales and investing in others in a move to focus on its food and beverage, underwear and household products activities.

The units being sold or spun off through initial public offerings include Coach, a leather goods maker; PYA/Monarch, the nation's fourth-largest foodservice distributor; sports and casual apparel maker, Champion; and International Fabrics, a maker of raw materials used in intimate apparel which the company acquired as part of its recent purchase of British clothing manufacturer Courtaulds PLC.

The acquisitions include Uniao's coffee business, which is the largest coffee company in Brazil; Sol y Oro, the largest intimate apparel and men's underwear company in Argentina; and a minority stake in Johnsonville Sausage Company, a U.S.-based maker of sausage products.

Shares of Chicago-based Sara Lee rose 26.5 cents, or 1.4%, to close at $18.875 on the New York Stock Exchange.

With brands such as Hanes underwear, Ballpark hot dogs and L'eggs pantyhose, Sara Lee grew from a packaged food company founded in 1939 and formerly called Consolidated Foods into a consumer product company with $20 billion in annual sales.

However, as rival food manufacturers shed non-core businesses in the late 1980s and early 1990s, Sara Lee, which has seen its share price tumble in recent years, maintained a wide range of brands and product lines.

Analysts said the shake-up is long overdue.

"I think what they are doing is what everybody else did 10 years ago," one leading food analyst said. "Everybody else gave up their diversified operations long ago, but nobody really knew whether Sara Lee would focus on wallets or pork bellies."

The answer to that question is clear now, said Don Westfall, vice president of Promar International, a food marketing consulting firm based in Alexandria, VA.

"This is something that is long overdue at Sara Lee," Westfall said. "The divestitures do make sense. It is something that Quaker Oats and General Mills, who were once in the clothing business, did long ago."

In the short term, the moves announced May 30 will create several one-time cost write-downs and gains for the company. The company expects them to boost profits modestly in 2001, when earnings-per-share are forecast to grow in the mid-single-digit percentage range.

Sara Lee said, however, that a narrower focus on food, coffee and underwear will strengthen the company and boost profits to a greater degree in the long term.

Proceeds of the acquisitions--expected to amount to about $2.5 billion--will be used for making purchases in its core businesses, the company added.

"We will use funds from the divestiture to aggressively pursue strategic acquisitions," said C. Steven McMillan, incoming chief executive. "We will explore opportunities to expand the Sara Lee brand into new food categories."

Without pinpointing any individual food makers as targets, McMillan emphasized Sara Lee's goal of expanding globally--specifically the Asian, African and Latin American markets--to market products which can be made both within the U.S. and overseas.

Sara Lee said it will also consider funneling some of the cash into product development and repurchasing its shares.

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