
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: TUESDAY, October 24, 1995                   TAG: 9510240069
SECTION: BUSINESS                    PAGE: BUSINESS   EDITION: METRO 
SOURCE: Associated Press
DATELINE: CHICAGO                                LENGTH: Medium

SNAPPLE SALES SAG; QUAKER OATS CO. PRESIDENT RESIGNS

Quaker Oats Co. President Philip A. Marineau, who oversaw the ill-fated acquisition of Snapple Beverage Corp., resigned Monday just one week shy of the deal's first anniversary.

Analysts said Marineau, the No. 2 executive at Chicago-based Quaker, was an apparent casualty of Snapple's poor performance. Neither Quaker nor Marineau immediately returned calls, and there was no word of Marineau's plans.

Snapple sales, down 17 percent in the first half of this year, have fallen far short of expectations as consumers' thirst for so-called New Age beverages has cooled.

``The performance of Snapple in the first year has been below expectations, and I guess Marineau has got to be viewed as the scapegoat,'' said John McMillin, a food industry analyst at Prudential Securities Inc.

Marineau and Quaker Chairman William D. Smithburg touted Snapple in November as a pillar of Quaker's restructuring into a ``good-for-you foods'' company. But after selling off its pet food and other businesses to help pay for the $1.7 billion acquisition - a price widely criticized as too high - Quaker has been rumored a possible takeover target.

Smithburg will assume Marineau's duties, according to Quaker's one-page statement.

Marineau, 49, joined Quaker in 1972 and became president in January 1993 after guiding the Gatorade brand to global dominance among sports drinks.

He was put in charge of Snapple, which quickly faced increased competition from Lipton's bottled iced teas and Coca-Cola Co.'s Fruitopia drinks. Lipton, a division of PepsiCo Inc., was the biggest seller of bottled teas last year.

Beverage industry analysts disagree on whether New Age drinks are an expired fad. Sales of bottled teas, waters, juices and sports drinks are expected to grow 12 percent this year to $5.36 billion, according to the Beverage Marketing Corp. consulting firm. But the rate of growth has slowed dramatically for iced teas and fruit drinks, and gone flat or declined for carbonated natural beverages and coffee drinks.

Quaker had sales of $6.37 billion in the fiscal year ended June 30, up 7 percent from $4.95 billion in fiscal 1994. Its stock was down 75 cents at $34 a share on the New York Stock Exchange.

by CNB