"Nobody doesn't like Sara Lee"

With its famous and quirky double negative slogan, "Nobody doesn't like Sara Lee" the company has recently been pursued by Brazilian beef processor JBS SA, and a group led by private-equity firm Apollo Global Management LLC, Bain Capital LLC, TPG Capital LP and investor C. Dean Metropoulos, for close to $20 a share, fueling speculation for the past few months.

Yesterday the Board declared a regular quarterly dividend of $.115 per share on the company's common sock, payable on April 8, 2011. The dividend is payable to stockholders of record at the close of business on March 1, 2011. Sara Lee Corp. has paid quarterly dividends to its stockholders continuously for more than 65 years, and today's announcement represents the 260th consecutive quarterly dividend declared by the corporation, quite a record.

Today, the company announced it has agreed in principle to divide the company into two separate, publicly traded companies. The separation, expected to be completed in early calendar year 2012, will result in each company having leading consumer brands, compelling growth prospects and strong potential to deliver long-term value to shareholders.


Under the plan approved by its board, Sara Lee's North American Retail and North American Foodservice businesses (excluding the North American beverage business) will be spun off, tax-free, into a new public company that will retain the "Sara Lee" name. Its leading brands will include Sara Lee, Jimmy Dean, BallPark, Hillshire Farm, Chef Pierre and State Fair. The new company would have reported approximately $4.1 billion in revenue in fiscal 2010.


The yet to be named other company will consist of Sara Lee's current International Beverage and Bakery businesses, as well as the North American beverage business. Its leading brands will include Douwe Egberts Senseo, Pickwick, Maison du Café, L'OR, Café Pilão, Marcilla and Bimbo. This entity would have reported approximately $4.6 billion in revenue in fiscal 2010 using fiscal 2010 actual exchange rates.


Jan Bennink has been appointed executive chairman of the board; Marcel Smits was named CEO, Mark Garvey was named CFO, and CJ Fraleigh was named CEO of the new North American retail and Foodservice company.

In conjunction with the planned separation, the board of directors intends to declare a $3.00 per share special dividend on the company's common stock, the majority of which will be funded with proceeds from the sale of the company's North American Fresh Bakery business. The special dividend is expected to be declared and paid in fiscal 2012 and before completion of the spin-off of Sara Lee's North American Retail and North American Foodservice businesses.


"Today's announcement is a logical step following the divestment of our International Household and Body Care business and the announced sale of our North American Fresh Bakery business," said James Crown, who has served as chairman of the board since May 2010, and will continue on the board and will serve as lead independent.

"We have carefully considered various strategic alternatives, including unsolicited indications of interest in the company. We believe that the spin-off, plus the one-time special dividend, offers the greatest potential for delivering long-term shareholder value. These two pure-play companies will have their own distinct growth strategies within their respective core markets that will attract a more focused shareholder base."