ConAgra Foods Completes Sale of Its Gilroy Foods & Flavors Operations to Olam International

ConAgra Foods sold substantially all of the assets of Gilroy Foods & Flavors’ dehydrated garlic, onion, capsicum and Controlled Moisture, GardenFrost, Redi-Made, and fresh vegetable operations, all of which were part of the Commercial Foods reporting segment.

Jul 20 2010 --- ConAgra Foods, Inc., announced the completion of the sale of its Gilroy Foods & Flavors dehydrated and vegetable product operations to Olam International for before-tax proceeds of $250 million in cash, net of transaction costs and subject to post-closing adjustments. The seasoning blends and flavors business and supporting plant operations were not part of the sale and remain with ConAgra Foods’ Commercial Foods reporting segment.

Under the terms of the agreement, ConAgra Foods sold substantially all of the assets of Gilroy Foods & Flavors’ dehydrated garlic, onion, capsicum and Controlled Moisture, GardenFrost, Redi-Made, and fresh vegetable operations, all of which were part of the Commercial Foods reporting segment. Sales for those operations were approximately $300 million in fiscal 2010.

Additional details of the completed transaction include:

* Manufacturing facilities sold to Olam include: Gilroy, Hanford and Modesto, Calif.; Fernley, Nev.; Las Cruces, N.M.; and Umatilla, Ore. A warehouse in King City, Calif., also was included in the sale.
* A total of approximately 1,500 employees transitioned to Olam, including plant employees and those supporting the dehydrated and vegetable products business located at the Omaha, Neb., headquarters and other satellite locations for Gilroy Foods.
* Manufacturing facilities that were not sold to Olam consist of the Carol Stream, Ill., Cranbury, N.J., and Hyrum, Utah, locations which produce seasoning blends and flavors. ConAgra Foods maintains full ownership of these plants and operations continue as usual within the Commercial Foods reporting segment.
* Greg Estep, formerly president of the divested business for ConAgra Foods, is now president of spices and dehydrates for Olam International.
* Paul Maass, president of ConAgra Mills, assumed the additional responsibility of leading the remaining seasoning blends and flavors business under the Spicetec Flavors & Seasonings brand name.

ConAgra Foods has reclassified the financial results for the divested operations from continuing operations into discontinued operations for current and historical periods.