TIDMSRL
Sara Lee Corp. ("Sara Lee") (NYSE: SLE) today announced that it
has commenced a cash tender offer to purchase up to $470 million
combined aggregate principal amount of three series of its
outstanding debt securities. The terms and conditions of the tender
offer are set forth in an Offer to Purchase dated today and a
related Letter of Transmittal.
In the tender offer, Sara Lee is offering to purchase, subject
to certain conditions, up to $470 million combined aggregate
principal amount of its 6 1/8% Notes due 2032, 4.10% Notes due 2020
and 2.75% Notes due 2015 (collectively, the "notes"), subject to
the applicable caps and priority specified in the table below:
Aggregate Fixed
Principal Acceptance Reference Bloomberg Spread
Title CUSIP Amount Priority U.S. Reference (basis
of Treasury
Security Number Outstanding Tender Cap Level Security Page points)
6 1/8% 803111 AM5 $500,000,000 $250,000,000 1 3.125% BBTN 230
Notes due
due 11/15/2041
2032
4.10% 803111 AS2 $400,000,000 $150,000,000 2 2.00% BBTN 150
Notes due
due 2/15/2022
2020
2.75% 803111 AR4 $400,000,000 $150,000,000 3 0.25% BBTN 110
Notes due
due 2/15/2015
2015
The tender offer will expire on the "Expiration Date," which is
12:00 midnight, Eastern time, at the end of April 2, 2012, unless
extended. Holders of notes subject to the tender offer must validly
tender and not validly withdraw their notes on or before the "Early
Tender Date," which is 5:00 p.m., Eastern time, on March 19, 2012,
unless extended, to be eligible to receive the Total Consideration
(as described below). Holders of notes who validly tender their
notes after the Early Tender Date and on or before the Expiration
Date will receive the Tender Consideration per $1,000 principal
amount of notes tendered by such holders that are accepted for
purchase, which is equal to the applicable Total Consideration
minus the applicable Early Tender Premium of $30 per $1,000
principal amount of notes. Holders of notes subject to the tender
offer who tender their notes may not withdraw their notes after the
"Withdrawal Date," which is 5:00 p.m., Eastern time, on March 19,
2012, except in limited circumstances where additional withdrawal
rights are required by law.
The Total Consideration for each $1,000 principal amount of
notes tendered and accepted for purchase pursuant to the tender
offer will be determined in the manner described in the Offer to
Purchase by reference to a fixed spread specified for each series
of the notes over the yield based on the bid side price of the U.S.
Treasury Security specified in the table above, as calculated by
the Lead Dealer Managers at 1:00 p.m., Eastern time, on March 20,
2012. Holders whose notes are accepted for purchase pursuant to the
tender offer will also receive accrued and unpaid interest on their
purchased notes from the last interest payment date for such notes
to, but excluding, the Settlement Date. Subject to the terms and
conditions of the tender offer, the Settlement Date will follow
promptly after the Expiration Date and currently is expected to be
Tuesday, April 3, 2012.
The tender offer is not conditioned upon any minimum amount of
notes being tendered, and, subject to applicable law, the tender
offer may be amended, extended, terminated or withdrawn in whole or
with respect to one or more series of notes. The amounts of each
series of notes that are purchased in the tender offer will be
determined in accordance with the acceptance priority levels set
forth in the Offer to Purchase and referenced in the table above,
with 1 being the highest acceptance priority level and 3 being the
lowest acceptance priority level. In addition, no more than
$250,000,000 aggregate principal amount of the series of notes with
acceptance priority level 1, no more than $150,000,000 aggregate
principal amount of the series of notes with acceptance priority
level 2 and no more than $150,000,000 aggregate principal amount of
the series of notes with acceptance priority level 3 will be
purchased (each such aggregate principal amount, a "tender cap"
with respect to the applicable series of notes). Subject to
applicable tender caps, all notes validly tendered and not validly
withdrawn in the tender offer having a higher acceptance priority
level will be accepted before any tendered notes having a lower
acceptance priority level are accepted in the tender offer. Notes
of a series subject to a tender cap may be subject to proration if
the aggregate principal amount of the notes of such series validly
tendered and not validly withdrawn is greater than the applicable
tender cap. Notes of the series in the lowest acceptance priority
level accepted for purchase in accordance with the terms and
conditions of the tender offer may be subject to proration so that
Sara Lee will only accept for purchase notes up to a combined
aggregate principal amount of $470,000,000.
Sara Lee has retained Goldman, Sachs & Co. and Morgan
Stanley & Co. LLC to serve as the Lead Dealer Managers for the
tender offer. Sara Lee has retained BNP Paribas Securities Corp.,
Lloyds Securities Inc., Mitsubishi UFJ Securities (USA), Inc. and
RBS Securities Inc. to serve as the Co-Dealer Managers for the
tender offer. Goldman, Sachs & Co. may be contacted at (800)
828-3182 (toll free) or (212) 357-4692 (collect) and Morgan Stanley
& Co. LLC may be contacted at (800) 624-1808 (toll free) or
(212) 761-1057 (collect). Sara Lee has also retained D.F. King
& Co., Inc. to serve as the Tender Agent and the Information
Agent for the tender offer.
This press release is not a tender offer to purchase or a
solicitation of acceptance of a tender offer, which may be made
only pursuant to the terms of the Offer to Purchase and the Letter
of Transmittal. The tender offer does not constitute an offer to
purchase notes in any jurisdiction in which, or to or from any
person to or from whom, it is unlawful to make such offer or
solicitation under applicable securities or blue sky laws. None of
Sara Lee, the Tender Agent, the Information Agent, any of the
Dealer Managers or the trustee for the notes is making any
recommendation as to whether holders should tender notes in the
tender offer.
Any questions or requests for assistance or additional copies of
the Offer to Purchase and the Letter of Transmittal may be directed
to D.F. King & Co., Inc. by telephone at (800) 290-6427 (toll
free), or in writing at 48 Wall Street, 22nd Floor, New York, NY,
10005, Attention: Elton Bagley. You may also contact your broker,
dealer, commercial bank or trust company or other nominee for
assistance concerning the tender offer.
Forward Looking Statements
This release contains forward-looking statements with respect to
the timing and principal amount of debt securities to be purchased
in the cash tender offer, including certain terms and conditions of
the cash tender offer. The Offer to Purchase and other documents
and statements of Sara Lee contain certain forward-looking
statements, including the anticipated costs and benefits of
restructuring, transformation and actions associated with Sara
Lee's Project Accelerate initiative, other matters related to Sara
Lee's spin-off plans, access to credit markets and Sara Lee's
credit ratings, the planned extinguishment of debt (including
through the tender offer), the funding of pension plans, potential
payments under guarantees and amounts due under future contractual
obligations and commitments, projected capital expenditures, cash
tax payments, pension settlement amounts and effective tax rates.
In addition, from time to time, in oral statements and written
reports, Sara Lee discusses its expectations regarding its future
performance by making forward-looking statements preceded by terms
such as "expects," "projects," "anticipates" or "believes." These
forward-looking statements are based on currently available
competitive, financial and economic data, as well as management's
views and assumptions regarding future events. Such forward-looking
statements are inherently uncertain, and investors must recognize
that actual results may differ from those expressed or implied in
the forward-looking statements. Consequently, Sara Lee wishes to
caution readers not to place undue reliance on any forward-looking
statements. Among the factors that could cause Sara Lee's actual
results to differ from such forward-looking statements are those
described in Sara Lee's Annual Report on Form 10-K for the fiscal
year ended July 2, 2011, as well as factors relating to:
-- Sara Lee's proposed spin-off plans and the related special dividend,
such as (i) unanticipated developments that delay or negatively
impact
the proposed spin-off and capital plans; (ii) the anticipated
costs
and benefits of restructuring actions taken to prepare for
the
spin-off; (iii) Sara Lee's ability to obtain customary
approvals; (iv)
Sara Lee's ability to generate the anticipated efficiencies
and
savings from the spin-off including a lower effective tax rate
for the
spun-off company; (v) the impact of the spin-off on Sara
Lee's
relationships with its employees, major customers and vendors
and on
Sara Lee's credit ratings and cost of funds; (vi) changes in
market
conditions; (vii) future opportunities that Sara Lee's board
of
directors may determine present greater potential value to
shareholders than the spin-off and special dividend; (viii)
disruption
to Sara Lee's business operations as a result of the spin-off;
(ix)
future operating or capital needs that require a more
significant
outlay of cash than currently anticipated; and (x) the ability
of the
businesses to operate independently following the completion of
the
spin-off;
-- Sara Lee's relationship with its customers, such as (i) a significant
change in Sara Lee's business with any of its major customers,
such as
Walmart, its largest customer; and (ii) credit and other
business
risks associated with customers operating in a highly
competitive
retail environment;
-- The consumer marketplace, such as (i) intense competition, including
advertising, promotional and price competition; (ii) changes
in
consumer behavior due to economic conditions, such as a shift
in
consumer demand toward private label; (iii) fluctuations in
raw
material costs, Sara Lee's ability to increase or maintain
product
prices in response to cost fluctuations and the impact on Sara
Lee's
profitability; (iv) the impact of various food safety issues
and
regulations on sales and profitability of Sara Lee products; and
(v)
inherent risks in the marketplace associated with product
innovations,
including uncertainties about trade and consumer acceptance;
-- Sara Lee's international operations, such as (i) impacts on reported
earnings from fluctuations in foreign currency exchange
rates,
particularly the euro; (ii) Sara Lee's generation of a high
percentage
of its revenues from businesses outside the United States and
costs to
remit these foreign earnings into the U.S. to fund Sara Lee's
domestic
operations, dividends, debt service and corporate costs;
(iii)
difficulties and costs associated with complying with U.S. laws
and
regulations, such as Foreign Corrupt Practices Act, applicable
to
global corporations, and different regulatory structures and
unexpected changes in regulatory environments overseas; and (iv)
Sara
Lee's ability to continue to source production and conduct
operations
in various countries due to changing business conditions,
political
environments, import quotas and the financial condition of
suppliers;
and
-- previous business decisions, such as (i) Sara Lee's ability to
generate margin improvement through cost reduction and
efficiency
initiatives; (ii) Sara Lee's credit ratings, the impact of Sara
Lee's
capital plans on such credit ratings and the impact these
ratings and
changes in these ratings may have on Sara Lee's cost to borrow
funds
and access to capital/debt markets; (iii) the settlement of a
number
of ongoing reviews of Sara Lee's income tax filing positions
in
various jurisdictions and inherent uncertainties related to
the
interpretation of tax regulations in the jurisdictions in which
Sara
Lee transacts business; and (iv) changes in the expense for
and
contingent liabilities relating to multi-employer pension plans
in
which Sara Lee participates.
In addition, Sara Lee's results may also be affected by general
factors, such as economic conditions, political developments,
interest and inflation rates, accounting standards, taxes and laws
and regulations in markets where Sara Lee competes. Sara Lee
undertakes no obligation to publicly update any forward-looking
statements, whether as a result of new information, future events
or otherwise.
About Sara Lee Corporation
Sara Lee Corp. (NYSE: SLE) and its leading portfolio of food and
beverage brands, including Ball Park, Douwe Egberts, Hillshire
Farm, Jimmy Dean, Pickwick Teas, Sara Lee and Senseo, generate
nearly $8 billion in annual net sales from continuing operations
and employ approximately 20,000 people worldwide. In January 2011,
Sara Lee Corp. announced that it will divide the company into two
pure-play publicly-traded companies, one focused on the
international coffee and tea market and the other on North American
meats. For more information on the company, please visit
www.saralee.com.
Sara Lee CorporationMedia: Mike Cummins,
+1.630.598.8123Analysts: Melissa Napier, +1.630.598.8739
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