Sara Lee to sell coffee, tea biz

Sara Lee, which said earlier this year that it will split its business in two, has agreed to sell a majority of its North American coffee and tea operations to The JM Smucker Company for $350 million.

Sara Lee, which said earlier this year that it will split its business in two, has agreed to sell a majority of its North American coffee and tea operations to The JM Smucker Company for $350 million.

Sara Lee will transfer about 450 of the 690 employees in the foodservice business to Smucker, it said in a statement. The transaction is expected to close in early 2012.

Jan Bennink, executive chairman of the board at Sara Lee, explained the reasoning behind the sale in a statement:

“In recent years, our North American coffee business has been foodservice-based and largely unbranded, which is a challenge in a highly competitive marketplace. Our decision to sell a major part of this business to Smucker is an example of Sara Lee Coffee and Tea's renewed focus on sustainable, profitable growth and part of our mandate to create the strongest possible pure-play company.”

Sara Lee also plans to discontinue the Senseo coffee line, excluding "select online channels," in North America by March 31, 2012.

Earlier this year, Sara Lee said it will split its businesses into two, tentatively titled independent companies - Sara Lee 2.0 and CoffeeCo - by March 2012. In June, Jon Harris was named CCO of Sara Lee 2.0.

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