Sara Lee Discusses Proposed Spin-off Transaction at CAGNY

Presenting at the Consumer Analyst Group of New York's (CAGNY) annual conference, Sara Lee Corp.

today reviewed its plan, announced on Jan. 28, 2011, to spin off its North American Retail and Foodservice business in a tax-free transaction, creating two pure-play, publicly traded companies. Marcel Smits, chief executive officer, and Mark Garvey, chief financial officer, presented. The spun-off North American Retail and Foodservice business (excluding North American beverage) will retain the Sara Lee name and is expected to account for approximately $4.2 billion of the company's total fiscal 2011 net sales, based on the mid-point of current guidance. The business has benefitted from investments in leading industry brands including Jimmy Dean, Hillshire Farm and Ball Park, which have generated strong growth and financial results over the past five years. The business's focus on innovation, value-added sales mix and operational efficiency has driven substantial margin improvement across its categories. Investments such as the new, state-of-the-art, sliced-meats facility in Kansas City, Kan., which began production this month, support the company's goal of furthering its sustained competitive advantage. This yet-to-be-named company, internally referred to as “CoffeeCo,” will consist of Sara Lee's International Beverage and Bakery businesses, as well as the current North American beverage business, and is expected to account for approximately $4.85 billion of the company's total fiscal 2011 net sales, based on the mid-point of current guidance.