Heinz philanthropy won't change, despite new ownership
By Thomas Olson
Published: Saturday, Feb. 16, 2013, 9:40 p.m.
The acquisition of H.J. Heinz Co. won't uproot the company from its Pittsburgh birthplace, but outside owners will now be guiding the storied ketchup maker, whose charitable largesse runs deep here.
What will that mean for philanthropy and long-standing family ties that have given name to public buildings such as the Steelers' home field?
Nothing, says Heinz and other local leaders.
“It's business as usual at Heinz,” company spokesman Michael Mullen said on Friday. “The agreement calls for ongoing philanthropic support of community initiatives and related programs, sponsorships and goodwill.”
Allegheny County Executive Rich Fitzgerald acknowledged that Heinz has played a critical role in providing local jobs and philanthropy. He said he expects the company will continue to be a good corporate citizen.
Heinz has been a “great community and corporate partner,” Fitzgerald said. “My sense is I don't think things will change.”
Heinz agreed to be taken private in a $28 billion deal on Thursday with billionaire Warren Buffett's Berkshire Hathaway Inc. and 3G Capital, a private-equity firm in Brazil that is controlled by another billionaire, investor Jorge Paulo Lemann.
The deal, which is expected to close in the third quarter, means that Heinz is giving up its more than 140 years of independence. But no one is betting that it will give up its local ties or close its pocketbook.
“The takeover, maybe, gives us opportunities that we don't have now. This is all so new that I don't know what those opportunities are,” said Luke Hingson, president of Brother's Brother Foundation, a North Side-based international relief organization.
Brother's Brother received $45,000 last year from the H.J. Heinz Company Foundation and has asked for $55,000 this year, Hingson said. And he isn't worried about losing that support under the new owners.
“We've received funds from Heinz, I'm going to say, for 30 years or longer,” Hingson said.
The H.J. Heinz Company Foundation contributed $12.8 million in 2010 and 2011 to charities across the country, company figures show. Local figures were not available.
Besides Brother's Brother, other local recipients include the Greater Pittsburgh Community Food Bank, the Extra Mile Education Foundation and Manchester Bidwell Corp.
Heinz's charitable contributions and its name are not the only things on the minds of the Pittsburgh community with the shift to deep-pocketed owners who lack local ties.
What about the headquarters and jobs?
After all, the city has been burned over the years as companies, especially after they lost their independence in buyouts, relocated elsewhere.
3G Capital managing partner Alex Behring said his firm and Berkshire Hathaway were “committed” to leaving Heinz headquarters in Pittsburgh and growing it.
Corporate icons that have left Pittsburgh in recent years include:
• Mellon Financial Corp., which merged with Bank of New York in 2006 and moved its headquarters to New York.
• Aluminum giant Alcoa Inc. did not merge but quietly moved its headquarters to New York in 2006.
• Freemarkets Inc., an online auction pioneer, was acquired by Ariba Inc. in 2005 and moved to Sunnyvale, Calif.
In the more distant past, Pittsburgh has lost such household names as Gulf Oil in 1984 and Rockwell International in 1988 to other cities.
“Berkshire has traditionally left the businesses it acquires on the path they're on and left them located where they are,” said Craig Wolfanger, president of Raptor Partners LLC, a financial advisory firm based Downtown.
Buffett's smorgasbord of companies under the Berkshire Hathaway label contains many household names, including:
• Burlington Northern Santa Fe, the railroad giant, bought for $26.7 billion in 2009.
• Geico, the insurance firm, bought for $2.3 billion in 1995.
• Mars, the candy maker, bought for $2.1 billion in 2008.
Among 3G Capital's company stakes is the fast-food chain Burger King Worldwide Inc.
“It would be really bad publicity if (Berkshire and 3G Capital) pulled up Heinz's 1,200 jobs in Pittsburgh and moved them elsewhere,” said Matthew Steve, senior associate at Strategic Advisors Inc. in Canonsburg.
Trib Total Media staff writerJason Cato contributed to this report.Staff writer Thomas Olson can be reachedat 412-320-7854 or email@example.com.
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