Del Monte Foods Co. Chairman Rick Wolford never considered pulling out of Pittsburgh, even when the San Francisco company decided last year it was time to sell its North Side private label soup and baby food plant.
Now he's counting on the 550 Del Monte regional headquarters employees here who handle such administrative functions as finance, information technology and sales to embrace the company's $705 million acquisition of Meow Mix Holdings Inc.
Once the support operation has that business under its belt, it can anticipate handling even more as Del Monte officials continue to look for products that will fit with their expertise and boost profitability.
"We're really pleased with our Pittsburgh operations," Mr. Wolford said yesterday on the heels of telling Wall Street that his company would sell its soup and baby food businesses for about $275 million, then turn around and use the proceeds to help fund the purchase of the cat food business.
The historic fruit and vegetable company first arrived in the Steel City four years ago when another big transaction with ketchup maker H.J. Heinz Co. gave it a collection of underperforming businesses that included StarKist tuna, pet food brands such as 9Lives and Kibbles 'n Bits, as well as the soup and baby food lines.
Del Monte never did persuade the locals to stop calling the North Side soup plant "the Heinz plant" -- a name that is still on the side of the building -- but the food company finally put its own name on a new flagship building sitting in a highly visible spot between Heinz Field and PNC Park.
The company, which leases about two-thirds of the 270,000-square-foot structure, has room to grow there and anticipates doing just that -- perhaps as soon as the ink dries on the Meow Mix deal. While officials aren't sure if Pittsburgh will pick up any staff as a result of the acquisition -- the cat food business has a plant in Decatur, Ala., and some support staff in Secaucus, N.J. -- a team will be working to determine how to integrate the businesses.
Del Monte officials believe that they can save about $20 million in merging the two organizations, an estimate based on such issues as handing research and sales duties to Del Monte personnel. "We have a sales infrastructure that is begging for more things to do," said David L. Meyers, the company's chief financial officer, to analysts in a morning conference call.