International Multifoods Corp. (NYSE:IMC) yesterday said that it expects the Federal Trade Commission’s review of the proposed General Mills-Pillsbury merger and Multifoods’ pending acquisition of the Pillsbury desserts and specialty products businesses to extend to the end of September. Multifoods previously said that it expected its acquisition of the Pillsbury businesses to close by the end of August.
Based on this revised schedule, Multifoods now anticipates full-year fiscal 2002 earnings to be in the range of $1.25 to $1.35 per diluted share. This estimate includes a contribution of up to 10 cents per share from the acquisition for the company’s current fiscal year ending March 2, 2002.
The company continues to expect the acquired businesses to add at least 40 cents per share to its earnings in the first full 12 months after closing.
The company also said that it continues to anticipate some favorable modifications to the original purchase agreement, which was announced on Feb. 5. The February agreement includes a long-term license to use the Pillsbury trademark in the desserts and baking mix category, the outright purchase of the Hungry Jack, Martha White and U.S. Robin Hood trademarks, and a five-year license for the Pillsbury trademark in the non-custom foodservice baking mix category. Combined, these businesses generate net sales of about $450 million, for which Multifoods agreed to pay approximately $305 million in cash, or less than 4.5 times EBITDA. The anticipated changes to the original purchase agreement are expected to be beneficial to Multifoods long term and have minimal effect on the purchase price. Details on the amended transaction terms will be provided when a final settlement with the FTC has been reached.
All earnings per share figures are presented under Generally Accepted Accounting Principles prior to the release of Financial Accounting Standards Nos. 141 and 142, which were issued July 20.
About International Multifoods
International Multifoods is a manufacturer for and distributor to the foodservice industry in North America. The company also is a leading manufacturer and marketer of consumer foods in Canada. Further information about International Multifoods is available on the Internet at www.multifoods.com.
Forward-Looking Language
This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on current expectations or beliefs, including, but not limited to, statements concerning the company’s operations and financial performance and condition. For this purpose, statements that are not statements of historical fact may be deemed to be forward-looking statements. The company cautions that these statements by their nature involve risks and uncertainties, and actual results may differ materially depending on a variety of important factors, including, among others, the closing of the proposed acquisition and the timing of the close; actions in the financial markets; regulatory approval related to the proposed acquisition; integration problems associated with the proposed acquisition; the results of our review of strategic alternatives for Multifoods Distribution Group; the impact of competitive products and pricing; market or weather conditions that may affect the costs of grain, cheese, other raw materials, fuel and labor; changes in laws and regulations; fluctuations in interest rates; fluctuations in foreign exchange rates; risks commonly encountered in international trade; and other factors as may be discussed in the company’s Annual Report on Form 10-K for the year ended March 3, 2001, and other reports filed with the Securities and Exchange Commission.
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