After merging with paper products firm Fonda Group Inc. of St. Albans, Vt., Sweetheart Cup Co. experienced a shake-up in leadership and a downsizing of its headquarters.
William McLaughlin, Sweetheart president and chief executive officer, has left the company. Fonda President Thomas Uleau assumed the positions of president and chief operating officer. McLaughlin's compensation package for 1997 included a $491,661 salary, stock options and $125,000 in special incentives.
In addition, Dennis Mehiel, chairman and CEO of Fonda, has taken on those roles at Sweetheart. Hans Heinsen, chief financial officer of Fonda Group, was named senior vice president of finance and CFO of Sweetheart, replacing William Spengler. Michael Hastings became senior vice president of sales and marketing.
``Any time you have a change in ownership, it is not unusual to also have a change in management,'' said Dan Carson, general counsel for Sweetheart.
Fonda also laid off about 50 of the 500 administrative employees at Sweetheart's Owings Mills, Md., headquarters.
The debt-leveraged transaction closed earlier this month. Fonda floated notes worth $77.5 million to fund the acquisition. Sweetheart's primary shareholder, American Industrial Partners, sold 48 percent of its voting stock and gave Fonda management responsibility over the firm. AIP retained 52 percent of its voting stock. SF Holdings, the holding company Fonda formed to run the combined businesses, bought all of a new class of nonvoting common stock from Sweetheart and acquired 100 percent of Fonda's outstanding common stock.
Sweetheart employs about 7,500 corporatewide. About 50 percent of its sales are plastics-related. The firm makes plastic and paper cups, plates, utensils and food containers, and has thermoforming operations at nine plants in North America.
This year, Sweetheart placed No. 3 in Plastics News' ranking of North American thermoformers, with related estimated sales of $237 million for the year ended Sept. 30. The firm reported a loss of about $47 million on total sales of $886 million.
Fonda Group employs 1,800 at 10 plants. It makes paper plates, trays, tray covers and napkins and had sales of $252 million.