Business: In the Dough

• Share

Chairman Harold S. Geneen describes his $2.8-billion International Telephone & Telegraph Corp. as a "unified-management, multiproduct company." On that principle, in 48 major acquisitions in the last nine years, ITT has acquired a hotel chain (Sheraton), a car-rental company (Avis), a book publisher (Bobbs-Merrill), a home-builder (Levitt & Sons, Inc.), a paper and chemical company (Rayonier, Inc.) and assorted other ventures. Something Geneen still does not have is a consumer foods company. Last week he moved to remedy that deficiency by announcing that ITT, in an exchange of stock valued at $280 million, will soon acquire Continental Baking Co., the nation's largest breadmaker.

For ITT, this would be a yeasty investment. Continental's bread, led by Wonder, is sold in 46 states and in Mexico, Jamaica and the Bahamas. Continental, which also makes Hostess cakes and Morton frozen foods, had total sales of $621 million last year. Its management, headed by Chairman and Chief Executive R. Newton Laughlin, will continue to operate Continental. The parent company will act as "a repository of technical knowledge for Continental," says ITT Executive Vice President Hart Perry, who supervised the month-long negotiations.

The main reason that the directors of profitable Continental are willing to join ITT is to take advantage of advanced ITT research in such areas as food irradiation, electronic cooking and computerized process controls. ITT, operating all around the world, can also provide Continental with expertise for moving into international markets.