1. In what sense is the Sara Lee business strategy in effect a breakup strategy? Be specific.
2. Would you expect investors to be better off buying Sara Lee stock or investing in a similar set of consumer product businesses in their own personal investment portfolios? Explain your answer.
3. Why did the 2005 restructuring program appear to have been unsuccessful in achieving a sustained increase in Sara Lee’s earnings per share and in creating value for the Sara Lee shareholders?
4. Why is a breakup strategy conceptually simple to explain but often difficult to implement? Be specific.
5. Explain why Sara Lee may have chosen to spin off rather than to divest HanesBrands Inc. Be specific.

After spurning a series of takeover offers, Sara Lee, a global consumer goods company, announced in early 2011 its intention to split the firm into two separate publicly traded companies. The two companies would consist of the firm’s North American retail and food service division and its international beverage business. The announcement comes after a long string of restructuring efforts designed to increase shareholder value. It remains to be seen if the latest effort will be any more successful than earlier efforts.