Drugs to Be Sole FocusFor Bristol-Myers

Bristol-Myers Squibb Co. has decided that the only business it wants to be in is pharmaceuticals, and the company has been taking steps to shed non-core operations so that it can devote its attention and resources to its drug business. Earlier this year the company said it would sell or spin off its Warsaw, Ind.-based Zimmer Inc. unit, maker of orthopedic implants, and recently announced that it is selling its Clairol hair care line to Procter & Gamble Co. for nearly $5 billion. Both businesses are profitable. Clairol contributed $1.9 billion in sales in 2000 and Zimmer had about $1.1 billion in revenue last year, up 9%. In total, Bristol-Myers had 2000 revenue of $21.1 billion. According to market research firm ACNielsen, Clairol, the No. 2 hair care products company behind L’Oreal, controls 39% of the U.S. hair coloring market. L’Oreal has a 50% share. On a global basis, Clairol has a 12% share and still trails leader L’Oreal. The sale will add the Clairol, Nice n Easy, and Herbal Essences brands to P&G’s hair care portfolio, which includes the Pantene, Head & Shoulders, Vidal Sassoon, and Physique brands. P&G sees the acquisition as part of its plan to revitalize itself by focusing only on leading brands. P&G itself is in the process of restructuring and has been paring the number of brands it markets. Earlier this year the company divested its Clearasil skin care line and its Spic & Span and Cinch cleaning products lines, contributed its Pringles potato chip and Sunny Delight drink brands to a joint venture with Cola-Cola Co., and said it may sell its Crisco shortening and Jif peanut butter brands. Bristol-Myers had operated in four business areas in recent years: pharmaceuticals, beauty care, medical devices, and nutritionals. In addition to its core drug business, the company still controls ConvaTec, a manufacturer and marketer of ostomy and wound and skin care products, and Mead Johnson Nutritionals, which produces nutritional products such as Boost energy drinks and Enfamil infant formulas. Bristol-Myers would not return calls for comment, but it is expected that those two businesses will be shed.