AHP TIGHTENING HEALTHCARE FOCUS WITH SALE OF HOUSEHOLD PRODUCTS
AHP TIGHTENING HEALTHCARE FOCUS WITH SALE OF HOUSEHOLD PRODUCTS business worldwide under an agreement in principle with the British firm Reckitt & Colman, announced March 9. American Home Products said the purchase price for the Boyle-Midway (the U.S. arm) and Whitehall-Boyle International household products group is $1.25 bil., which translates into nearly twice the group's 1989 sales of $650 mil. Reckitt & Colman is an international consumer products company; the firm had 1988 sales of $2.5 bil. (U.S. dollars) and earnings of $214 mil. The proposed divestiture, which will help allay the cost of the $3.2 bil. A. H. Robins acquisition, consummated on Dec. 15, underscores the reputation of AHP as a company ever concerned with the bottom line; however, the restructuring also is another sign of American Home's increasing commitment to being a full-range health care company. The agreement-in-principle leaves AHP with its American Food Products Division as the only non-health care related unit. AHP's food business (Chef Boyardee, Jiffy Pop, Gulden's mustards, Wheatena and Maypo) is mostly in the U.S. and Canada and generated $731.4 mil. in revenues in 1989. The food business is the company's second largest operation behind prescription and consumer drug health care which, together, accounted for about three-quarters of AHP's $6.75 bil. in 1989 sales. The proposed deal does not cover the rights to Pam cooking sprays and Butter Buds food products, which are currently part of Boyle-Midway.
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