FORM 8-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934
Date of Report: May 9, 1995
(Date of earliest event reported)
KIMBERLY-CLARK CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-225 39-0394230
(State or other jurisdiction (Commission File (IRS Employer
of incorporation) Number) Identification No.)
P.O. Box 619100, Dallas, Texas 75261-9100
(Address of principal executive offices) (Zip Code)
(214) 830-1200
(Registrant's telephone number, including area code)
_____________________________________
<PAGE>
Item 5. Other Events
Attached hereto as Exhibit 99 is a press release announcing
Kimberly-Clark Corporation's plans to spin off its tobacco-
related businesses and to cut costs by $100 million annually.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.
KIMBERLY-CLARK CORPORATION
Date: May 9, 1995 By:/s/ John W. Donehower
----------------------------
John W. Donehower
Senior Vice President and
Chief Financial Officer
<PAGE>
EXHIBIT INDEX
(99) Press release issued by Kimberly-Clark
Corporation on May 9, 1995.
EXHIBIT 99
Kimberly-Clark Corporation Dallas, Texas 75261-9100
Phone 214-830-1200
For Release: For Further Information:
Tina S. Barry
(214) 830-1484
Kimberly-Clark To Spin Off Tobacco-Related Businesses as Part
of Plan To Improve Shareholder Value
DALLAS, May 9, 1995--Kimberly-Clark Corporation today announced
a series of actions to improve shareholder value. Plans
include a spin-off of the company's tobacco-related businesses
in the U.S. and France and a program to cut costs at Kimberly-
Clark by more than $100 million annually on a pretax basis
beginning in 1996.
"While we are achieving strong volume growth and improved
market shares in most of our North American businesses and in
many countries abroad, to return the company to consistent
double-digit earnings growth we must further increase sales,
improve productivity and reduce costs," said Wayne R. Sanders,
chairman of the board and chief executive officer of Kimberly-
Clark.
Kimberly-Clark said it expects to increase earnings by at
least 10 percent a year in 1995 and beyond, despite the spin-
off. "We are committed to generating double-digit earnings
growth and a return on equity in excess of 20 percent," Mr.
Sanders said.
The spin-off will consist of U.S. and French operations
that make cigarette paper and other tobacco-related products
and employ more than 2,300 people. In 1994, the combined
operations had sales of $404 million.
Prior to the spin-off, these operations will provide
approximately $100 million of cash proceeds to Kimberly-Clark.
The company said it plans to use the proceeds to buy back
shares of its common stock under a share repurchase plan
authorized in 1994.
In deciding to spin off tobacco-related businesses in the
U.S. and France, the company said its board of directors has
concluded that these businesses are incompatible with the
company's strategic direction as a manufacturer and marketer of
well-known consumer and health care brands and that separating
them from Kimberly-Clark's other businesses will enhance the
operations of each.
"The spin-off will allow each management team to focus
attention on their business objectives and on the customers and
markets they serve without concern for how the actions of one
may affect the other," Mr. Sanders said.
"Until recently, the board opposed divesting these
businesses because it would have had an adverse effect on the
economic returns to our shareholders," he said. "This plan for
a tax-free spin-off of these businesses to Kimberly-Clark
shareholders, combined with our cost savings program and the
present earnings outlook for our businesses, eliminates that
concern.
"Moreover, the plan will allow each investor in our stock
to make his or her own decision about whether to hold or divest
shares in the new company," Mr. Sanders said. "In either case,
we believe this plan enhances shareholder value, while
protecting the interests of employees, customers and the
communities where these operations are located. In other
words, we believe this decision is in the best interest of all
and should improve overall returns to our shareholders.
"As an independent, publicly held company, the tobacco-
related businesses should prosper," he added. "The new company
will have strong cash flow and ready access to capital markets.
It also will be conservatively financed and will have a
management team willing to invest to expand the operations and
to extend its leadership position as the largest worldwide
supplier of tobacco papers."
Senior management of the new company all will be
Kimberly-Clark executives. Upon completion of the spin-off,
Wayne H. Deitrich, President - Paper and Specialty Products
Sector of Kimberly-Clark, will become chairman and chief
executive officer of the new company. Mr. Deitrich, 51, has
been with Kimberly-Clark since 1970 and has management
responsibility for the U.S. and French tobacco-related
businesses, as well as other paper businesses at Kimberly-
Clark. He has a PhD in pulp and paper technology from the
Institute of Paper Chemistry and an MBA from the University of
Chicago.
In addition to maintaining management continuity, plans
call for sales, marketing, research and development, mill and
other employee teams to remain intact. Assets of the new
company, which will be headquartered in the Atlanta area, will
include six mills in the U.S., three in France and a flax
processing operation in Canada. These manufacturing operations
are located in Lee, Mass.; Spotswood, N.J.; Ancram, N.Y.; Le
Mans, Malaucene and Quimperle, France; and Winkler, Manitoba,
Canada.
Kimberly-Clark said it expects the spin-off to be
completed in late 1995 or early 1996. It is subject to a
favorable tax ruling by the Internal Revenue Service and
approval of the Kimberly-Clark board of directors.
Regarding the cost-savings program, the company said its
key components are: outsourcing the company's U.S. trucking
operations, consolidating mill and staff support units,
reducing inventories and globally sourcing selected raw
materials. In addition, the company has implemented tax
savings programs and is reducing general and administrative
expense as a percentage of sales.
As previously announced, the outsourcing of Kimberly-
Clark's trucking operation to Schneider National Carriers, Inc.
will result in the elimination of more than 700 positions, with
most of those affected expected to be offered jobs at Schneider
or other carriers. By consolidating support functions at mill
and staff units in North America, Kimberly-Clark expects to
eliminate another 150 to 250 positions.
Other measures will sharply reduce inventory levels of
finished product, while maintaining excellent customer service
through use of state-of-the-art sales forecasting tools and
improved manufacturing flexibility. In addition, the company
said it recently has negotiated more favorable arrangements
with various suppliers and has identified other opportunities
to reduce raw material costs by using the collective buying
power of its global business teams.
Costs to implement these plans, including severance,
disposal of certain assets and fees for the spin-off, will be
booked as incurred in 1995 and early 1996 and are not expected
to exceed a total of $20 million.
Kimberly-Clark is a manufacturer of household, personal
care and health care products, as well as newsprint and premium
business, correspondence and specialty papers. Its well-known
consumer products include Huggies diapers, Huggies Pull-Ups
training pants, Pull-Ups GoodNites underpants, Huggies baby
wipes, Kleenex facial tissue, Kleenex premium bathroom tissue,
Kotex and New Freedom feminine care products, Hi-Dri household
towels and Depend and Poise incontinence care products.
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