PM History/2 - Legacy Tobacco Documents Library

PM history/30
pr9.ce . . .twice a yr Kraft called its officers, lawyers & bankers to a
"fire d+-ill" in case he got that call one afternooni in their drills,
thQ hvothetical enemv was PM#~,##ssmooth bargainin , deal done at Westin
O'Hare Hotel at airport . . Kraft had fought back w/planned $114 billion
recapitalization . . .CONGRESS CRITICALs tremendous new clout PM has in
trying to~enc e its critics esp . in the pr_e~3s, dependent as it is on
a~~ w th PM as the nation~~a~Twer£ ser now . . .PM now the 7th lar~est
i_ndustrial en~rnr~se in US" --IS BIGGER BETTER FOR PHILIP MORRIS?, Fortune -~ 8-89e bet . Kraft
,~ 'purchase for $12 .~billion in Dec '88 thru mid-Apri1 PM stock rose 23%/
•Ic~ ! interview w/engagsng cotsman Hamish Maxwell, 62, and a 35yr PM veteran//
1~' »>!!! PM had r conside v ra ed ge a le uyou e d eb ar t y 1 in '88 b u t nie x d ita mo al st
certainly it would have meant breakup of the co . & "This says everything
you've done in the vast is wrong" . .it would mean liquicTa ing£~co to distribute
proceeds to ehareho~ders & this isn't "necessa 9i1 co structive .
I'd think differently about it if we cou n increase our earnings . . . ."/
PM's rowth not 'ust for sake of rowth . . . .earnings have followed + "Growth
so ovPns h,n~G „u for your emn ovees" . . . .PM always ran scared, e .g .,
BA~ 1 ~
. t sudde w more a ressive the bizs " T he cou
wel ma e ci s, such as Kools," there y maybe hurting PM//
"T E FOOD BUS . APPEALED IN PART BECAUSE IT'S ENTY OF ROOM FOJZ
GROWTH" . . .w/benefit of hindsight, 7-Un was not an appropria r u ;s ;tion,
though the idea behind it was OKe after all, Pensi was wav behind Coke
when it ~ot into +heaame in •30s ; but to play catch-up in the '70s &
rMs was a helluva lot harder, and 'ts ea 'n s were "too sm ke
strate 'c s se S we sold it" . . .BUT= MILLER T OUR EXPECTATIONS"
ough steam went out of it in 'SOs par y because A-B grew "more determined"
&"PERHAPS WE OVERREACHED ON PRICING . So the business tailed off"
so PM "started re er in VE BIT OUS - RM
WAY," introducing new brands . . ." E'RE NOT GOING TO SELL IT" /General Foods
perf. uneven.but some good new ideas . . .onl. .y real aroblem here is the
goffee biz, partly due to rise in soft-drink mkt . . .coffee can improve w/
better mktg & packaging ideas & coffee ad "has been terrib " . . .GF had
become more of "mandar' t e o o e ' n" (meaning bureacratized),
too many people oing things too slowly w o anybody really knowing what
the prob . was . . .g2od R&D~ maybe_best in indust~, but not yieldin$ enough,
but they had the go-sense 'to leave~cr 1Pa er in place in Wis .//KRAFT
"MUCH MORE LIKE PM" after making "a conscious decision to change the management
in the early '8Os" . . .noting rehearsals vs . takeovers by Kraft
' heads John Richman & Michael Miles . . .when takeover bid came, Richman ruled
f+ out defense that wo id have branded PM as "merchant of death" . . .many new
possibilities in the joint Kraft-GF operation, ,naybe one sales fo _^ce . . .
. can cholesterol be taken from eggs as caffeine was from coffee?=could
open vast new mkt . . .HM pushing for psychological synergy . . .Kraft has
wessentiall ac uired GF . . .fantastic growth opportunities abroa seen by
, who says ' eople have really i,ot to be conditioned NEVER TO BE SAT-
ISFIED." he doesn't want his people expecting me a1s after a good yr but
i
to ask "How could we have done better? What did we miss?"//SIDEBAR ON
TOB . OPERATIONSa Maxwell is pack-a-day smoker who says he quits "for a
month or so, EVERY SO TEN, JUST TO SHOW bAN . IT•S NOT ADDICTIVE" *
, tob . is abroad w/JAPAN AS THE REAL PRIZE, PM has grabbed 7 .5% of the mkt
1 there in past two vrs
##'rna''
a MUST USE LINE . . .w/a straight face e continues to argue ere is no
scientific evidence to prove that smkg causes any deadly disease . . .he says
ETS is "lar el a social i sue these da s, NOT A MEDICAL ONE" . . .industry
sales sl pping at about 2 . a yr t ou _,OOicans begin each day . . .
PM magazine touting co .'s philanthropies, e .g ., 71 tons of food sent to
Armenian earthquake victims//Daynard on litigation status : Cip . verdict
"has put everything in a state of suspended animation" . . .real oppty in
http://legacy.library.ucsf.edu/tid/fmw44c00/pdf