GLOBAL – ConAgra Foods announces Agreement to Sell Gilroy Foods & Flavors\’ Dehydrated and Vegetable Product Operations to Olam International

OMAHA, Neb. US – ConAgra Foods, Inc., announced yesterday that it has reached an agreement to sell its Gilroy Foods & Flavors dehydrated and vegetable product operations to Olam International for $250 million, subject to final working capital adjustments.
 
The seasoning blends and flavours business and supporting plant operations will remain with ConAgra Foods\’ Commercial Foods reporting segment following the transaction closing.
 
Under the terms of the agreement, ConAgra Foods will sell substantially all of the assets of Gilroy Foods & Flavors\’ dehydrated garlic, onion, capsicum and Controlled Moisture(TM), GardenFrost(R), Redi-Made(TM) and fresh vegetable operations, all of which are part of the Commercial Foods reporting segment.
 
Sales for those operations were approximately $300 million in fiscal 2010. The transaction is expected to close within 30 to 60 days subject to satisfaction of customary closing conditions, including normal regulatory approvals, with ConAgra Foods continuing to operate the business until that time.
 
\”This announcement is part of ConAgra Foods\’ ongoing strategy of divesting non-core operations to continuously improve our focus,\” said Gary Rodkin, chief executive officer of ConAgra Foods. \”As our past portfolio changes have demonstrated, transactions like these, along with our capital allocation discipline, have allowed us to concentrate our resources behind the highest opportunity areas of our company.
 
Olam\’s global leadership in food ingredients will provide the Gilroy Foods & Flavors dehydrated and vegetable products business more attention and resources for growth.\”
 
Additional details of the transaction include:
 
— Manufacturing facilities that are expected to transition to Olam\’s ownership include: Gilroy, Hanford and Modesto, Calif.; Fernley, Nev.; Las Cruces, N.M.; and Umatilla, Ore. A warehouse in King City, Calif., is also included in the sale. Upon the transaction closing, all current employees at these locations will transition to Olam.
 
— Virtually all current employees supporting the dehydrated and vegetable products business located at the Omaha, Neb., headquarters and other satellite locations for Gilroy Foods will transition to Olam.
 
— This agreement does not include the Carol Stream, Ill., Cranbury, N.J., and Hyrum, Utah, facilities, which produce seasoning blends and flavours. ConAgra Foods will maintain full ownership of these plants and continue operations as usual.
 
— Greg Estep, formerly president of this business unit for ConAgra Foods, is expected to become president of spices and dehydrates for Olam International.
 
— Paul Maass, president of ConAgra Mills, will assume the additional responsibility of leading the remaining seasoning blends and flavours business under the Spicetec Flavors & Seasonings brand name.
 
ConAgra Foods plans to reclassify the financial results for these operations from continuing operations into discontinued operations for current and historical periods beginning with the company\’s fiscal 2010 fourth-quarter earnings release, which is expected to be issued on June 24, 2010. The company\’s long-term financial guidance will not be altered by the completion of the sale of the operations or the reclassification.
 
Olam International is a leading global integrated supply chain manager and processor of agricultural products and food ingredients, sourcing 20 products with a direct presence in 64 countries and supplying them to more than 10,600 customers.
 
With direct sourcing and processing in most major producing countries for its various products, Olam has built a global leadership position in many of its businesses, including cocoa, coffee, cashew, sesame, rice, cotton and wood products.
 
Headquartered in Singapore and listed on the Sgx-St on Feb. 11, 2005, Olam currently ranks among the top 40 largest listed companies in Singapore in terms of market capitalization and is a component stock in the Straits Times Index (Sti), MSCI Singapore Free, S&P Agribusiness Index and the DAXglobal Agribusiness Index.
 
ConAgra Foods, Inc. is one of North America\’s leading food companies, with brands in 96 percent of America\’s households. Consumers find Banquet, Chef Boyardee, Egg Beaters, Healthy Choice, Hebrew National, Hunt\’s, Marie Callender\’s, Orville Redenbacher\’s, PAM, Peter Pan, Reddi-wip and many ConAgra Foods brands in grocery, convenience, mass merchandise and club stores.
 
ConAgra Foods also has a strong business-to-business presence, supplying potato, other vegetable, spice and grain products to a variety of well-known restaurants, foodservice operators and commercial customers.