ALLEGHENY BEVERAGE <ABEV> EXPLORES UNIT SALE
Allegheny Beverage Corp said it
has been approached by a group interested in acquiring its
foodservice unit, Service America Corp.
    The group includes senior management of Service America but
no officers of Allegheny Beverage, the company said.
    The company has agreed to permit the group and its
potential lenders to perform a due diligence review of Service
America, it said.
    Allegheny noted it had previously cancelled plans to spin
off the foodservice subsidiary.
    The company said the group's review is preliminary and
there is no assurance that an acquisition proposal will be made
or, if made, accepted.
    Service America had fiscal 1986 revenues of about 934 mln
dlrs, or about 83 pct of Allegheny Beverage's total revenues of
1.13 billion dlrs for the year ended March 29, 1986, a
spokesman for Allegheny Beverage said.
    He declined to identify the Service America officials in
the acquisition group.
    On Feb 18, 1987, Allegheny said it was cancelling the spin
off of Service America, but gave no reason for doing so. It
said it would place major emphasis on managing Service America
to improve operations and increase earnings at the unit.
    Service America, which Allegheny acquired in May 1985,
operates cafeterias and food and beverage vending machines.
Through other subsidiaries, Allegheny provides coin-operated
laundry services, building maintenance services and retail
office and furniture operations.
    In fiscal 1986, Allegheny reported earnings from continuing
operations of 8.2 mln dlrs or 1.09 dlrs a fully diluted share,
excluding income of 59.7 mln dlrs from discontinued operations
and an extraordinary loss of 8.1 mln dlrs. In May 1985,
Allegheny sold its Pepsi-Cola Bottling Co unit to Pepsico Inc
<PEP> for 160 mln dlrs.
    Including discontinued operations and the special item, net
income was 59.8 mln dlrs or 6.21 dlrs a share fully diluted.
 Reuter
