Seaboard Corporation Announces Repurchase of Equity Interest in Seaboard Foods LP
The former owners of Daily's also received an option to put their 4.74% equity interest back to Seaboard after two years for the greater of $40 million or a formula-determined value as of the put date.
02/01/07 As previously disclosed, a portion of the purchase price for Seaboard Corporation's July 2005 acquisition of Daily's consisted of a 4.74% equity interest in Seaboard Foods LP (previously Seaboard Farms, Inc.). The former owners of Daily's also received an option to put their 4.74% equity interest back to Seaboard after two years for the greater of $40 million or a formula-determined value as of the put date.
On December 27, 2006, Seaboard entered into a Purchase Agreement with the former owners of Daily's for Seaboard's repurchase of the 4.74% equity interest in Seaboard Foods effective January 1, 2007. Under this Purchase Agreement, on January 2, 2007 Seaboard will pay $30 million of the purchase price for the 4.74% equity interest to the former owners of Daily's. Seaboard will pay the balance of the purchase price in August, 2007, currently estimated based on the formula to be an additional $10-$40 million depending on operating results and certain net cash flows through June 30, 2007. The total purchase price for the 4.74% equity interest is equal to:
-- the greater of $40 million or the same formula-determined value of the original put option, determined as of June 30, 2007; less
-- the amount of interest which accrues on the initial $30 million portion of the purchase from January 2, 2007 through the date on which the balance of the purchase price is paid.
