By Martinne Geller
NEW YORK, July 3 When most food company
executives talk about emerging markets, they mean countries like
China and India. For Hillshire Brands CEO Sean Connolly, the
exciting untapped market is something different -- snack meat.
Hillshire Brands Co's HSH.N new chief executive is excited
about flavored sausages and snacks made with meat as he looks to
add "provocative" new items to his company's lineup of cold cuts
and hot dogs.
New meat products as snack food should be a key driver of
sales and profits for the newly independent company, Connolly
said, since they can serve more occasions, command higher prices
and expand Hillshire's reach beyond traditional grocery stores.
"We view that as an emerging market," Connolly said. "There
is a compelling consumer need around getting protein into the
snacking occasion, as opposed to some of the hollow calories
that they rely on today."
Connolly, who has spent a decade at both Campbell Soup
(CPB.N) and Procter & Gamble (PG.N), declined to talk about
specific products. Still, he said he was open to things that
require cooking, like the new Ball Park slider hamburgers, as
well as foods that can be eaten straight from the package.
"There hasn't been a lot of creative thought put into that
space over the years," Connolly said.
Slim Jim, owned by ConAgra Foods (CAG.N), is a leader in the
meat snack category.
Among Hillshire's portfolio of brands, Jimmy Dean has seen
consistent support and innovation, Connolly said, while others
have not. One brand that is lacking is the company's namesake
Hillshire Farms, whose smoked sausage is Connolly's favorite
"I'd like to see us make that line more contemporary. We
have some ideas up our sleeve to do just that," Connolly said,
citing flavor varieties as an example.
"You should expect us to shake it up. We're going to bring
some provocative news to our categories," he said.
The company's most expensive and fastest growing brand is
Aidells, whose sausages come in flavors like pineapple and
bacon, mango and jalapeno, and artichoke and garlic.
The Illinois-based company last week spun off its
international coffee and tea business and changed its name. The
move marked the end of a years-long narrowing of focus for Sara
Lee Corp, which at one time owned everything from Coach bags to
Playtex bras to Kiwi shoe polish.
Sara Lee decided to split up after takeover bids were not
high enough to lure it into a sale. Now, the leaner,
meat-focused Hillshire Brands is seen as a likely takeover
Its shares closed at $29.99 on Tuesday on the New York Stock
Exchange, rising nearly 18 percent in the first three days of
trading as a pure-play company.
Analysts have mentioned Tyson Foods Inc (TSN.N), Hormel
Foods Corp (HRL.N), Smithfield Foods Inc SFD.N and JBS
(JBSS3.SA) as possible suitors.
Connolly declined to comment on the takeover speculation.
"I wouldn't be here if I didn't think we were an incredibly
attractive company," he said, pointing to the company's assets,
people and opportunity to increase shareholder value.
"Our management team is quite confident we can do that as a
public stand-alone company. We also know we have a fiduciary
responsibility to our shareholders to maximize value."
(Reporting By Martinne Geller in New York; editing by Jim
Keywords: HILLSHIREBRANDS SNACKS/
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