Sara Lee Drops on No-Takeover Report
CNBC "On-Air Stocks" Editor
Sara Lee down as much as 4 percent Thursday on a story in TheDeal.com that a sale of the company appears unlikely, citing unnamed sources.
The company has been widely believed to be a takeover target, or that it might separately sell its meat or beverage businesses. A number of players, including Apollo Global Management and KKR, have reportedly expressed interest in a buyout.
Recall that CEO Brenda Barnes stepped down in August for health reasons.
Though SLE has many well-known brand names (Jimmy Dean, Hillshire Farm), it's a tough sell: the food business is highly competitive, and as we have seen in other companies, it is tough to get pricing power. Higher commodity costs, as has been widely reported, add to the uncertainty.
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