Campbell Completes Sale of UK and Irish Businesses to Premier Foods
Campbell sold the businesses, which include products manufactured under the "Homepride", "OXO", "Batchelors", "Erin" and "Fray Bentos" brands and four manufacturing sites, for approximately $870 million at the current exchange rate.
16/08/06 Campbell Soup Company has completed the sale of its UK and Irish businesses to Premier Foods plc following the approval of Premier's shareholders. Campbell announced the signing of the agreement on July 12, 2006.
Campbell sold the businesses, which include products manufactured under the "Homepride", "OXO", "Batchelors", "Erin" and "Fray Bentos" brands and four manufacturing sites, for approximately $870 million at the current exchange rate. Detailed financial information outlining the historical pro forma impact of the transaction and the anticipated use of proceeds will be made available shortly through a public filing.
Campbell also announced that its Board of Directors has authorized using approximately $620 million of the net proceeds of the sale to purchase company stock. These purchases are expected to be substantially completed in fiscal 2007. This share repurchase authority is in addition to the three-year $600 million share repurchase plan announced in November 2005 and the company's ongoing practice of buying back shares sufficient to offset shares issued under incentive compensation plans.
Douglas R. Conant, Campbell's President and Chief Executive Officer, said, "The sale of these businesses will better enable Campbell to focus on building our businesses within the simple meals and baked snacks categories in markets with the greatest potential for growth. Our decision to utilize a majority of the proceeds to purchase shares reflects the confidence we have in our long-term growth prospects and is consistent with our commitment to deliver strong investor returns."
Campbell retained the Goldman Sachs Group to advise on the divestiture.
