DOWNERS GROVE (dpa-AFX) - Sara Lee Corp. (SLE) Friday said it has received approval from the U.S. Department of Justice for sale of its North American Fresh Bakery business to Grupo Bimbo S.A.B. de C.V. The approval follows an agreement where Grupo Bimbo will divest certain brands and assets in eight geographic markets, without which the DOJ believes consumers would likely pay higher prices for sliced fresh bread.
Following the agreement, the transaction price including the assumption of debt will now be reduced to $709 million from $959 million.
Groupo Bimbo agreed to divest the Sara Lee and EarthGrains brands in California, and certain smaller brands in the Harrisburg/Scranton region of Pennsylvania and the Kansas City, Oklahoma City and Omaha metropolitan area.
The divestiture is still subject to final approval by the U.S. District Court and customary documentation. Sara Lee expects the transaction to close on November 5, 2011.
Sara Lee reiterated its intention to declare a $3.00 per share special dividend on the company's common stock, the timing of the dividend payout is still being determined.
Sara Lee will retain the right to sell Sara Lee branded frozen desserts and meat products, including sliced deli meats. Grupo Bimbo will have the rights to the Sara Lee brand in the fresh baked goods category globally, with the exception of Australia and New Zealand.
As part of the transaction, all of Sara Lee's approximately 13,000 North American Fresh Bakery employees will transfer to Grupo Bimbo. The sale also includes 41 plants in the U.S. and approximately 4,800 bakery routes, prior to the DOJ-required divestment.
On October 10, Sara Lee announced an agreement to sell its fresh bakery businesses in Spain and Portugal to Grupo Bimbo S.A.B. de C.V. for €115 million or about $154 million at current exchange rates, in cash. The transaction, which is subject to customary closing conditions and regulatory clearance, is expected to close within 60 days.
On October 3, Sara Lee completed the sale of its North American private brand Refrigerated Dough business to Ralcorp Frozen Bakery Products, Inc., a division of Ralcorp Holdings, Inc. (RAH) for $545 million.
Sara Lee's remaining international bakery businesses headquartered in France and Australia remain the subject of a divestiture process and a strategic review, respectively.
SLE closed Friday's regular trading at $17.77, up $0.51 or 2.95%, on the NYSE.
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