Kraft Selling Its Budget Gourmet Unit to Heinz : Frozen food: Spokesman for buyer unsure of plans for Orange headquarters. He says acquisition will complement its Weight Watcher line.

Kraft General Foods Inc. agreed Monday to sell All American Gourmet Co. of Orange, maker of the popular Budget Gourmet line of frozen food, to H.J. Heinz Co. Terms of the deal were not disclosed.

A Heinz spokesman said he was unaware of any immediate plans for All American’s Orange County headquarters, where 89 executives and other workers are employed. The company has total employment of about 1,000. “They haven’t gotten around to the organizational details,” explained Heinz spokesman D. Edward I. Smyth.

The frozen foods are packaged at plants in Clearfield, Utah, and in Atlanta.

Smyth said that Heinz is excited about the acquisition because it complements its other product lines. By combining raw materials, packaging and shipping with Heinz’s other frozen foods, the Pittsburgh-based food giant hopes to wring more profit from the Budget Gourmet line.

“This acquisition gives Heinz another major brand--the Budget Gourmet--to complement its Weight Watcher brand in the growing frozen-meals category,” said Heinz Senior Vice President David W. Sculley.

The All American unit will report to Michael McGrath, president of the Weight Watcher Food Co. division of Heinz. Smyth said that McGrath was one of the founders of the Budget Gourmet brand a decade ago before coming over to Heinz.

The two lines are complementary, he said, because Budget Gourmet is popular in the West, while Weight Watcher frozen foods are strongest in the East. Budget Gourmet is, as the name implies, value priced while Weight Watcher meals sell at higher prices.

And Budget Gourmet food sales of more than $300 million in 1993 are strong year-round, while Weight Watcher registers its best sales during January and February, when New Year’s weight-loss resolutions are still fresh in the minds of dieters.

“About 50% of Weight Watcher (meals) are sold to present or former Weight Watcher members,” Smyth said. “Budget Gourmet will be a stronger market.”

Kraft Chairman Richard P. Mayer said in a statement that its decision to sell Budget Gourmet “is consistent with our recently announced program to improve on the strategic alignment of our food portfolio.”

Kraft is a unit of Philip Morris, which has been attempting to streamline by selling non-core product lines. Philip Morris confirmed earlier this month, for instance, that the Kraft Food Service unit was for sale.

A Kraft spokeswoman, Kathy Knuth , said that the company is trying to concentrate on such core areas as cheese, cereal, baked goods and coffee.