ConAgra Foods Proposes $4.9 Billion Acquisition of Ralcorp Holdings

May 4, 2011
The all-cash proposal of $86 per share would put ConAgra Foods near the top of the private label game.
FoodProcessing.com Top 100 lister ConAgra Foods has made a proposal to the Ralcorp Holdings Board of Directors to acquire Ralcorp. According to a release issued by ConAgra, the acquisition would include $86 per share in cash, or approximately $4.9 billion, plus the assumption of $2.5 billion in debt. The proposed acquisition of Ralcorp Holdings would expand ConAgra Foods' presence in the private label segment.  Ralcorp manufactures both private label and branded consumer foods. The company owns the Post cereal brand as well as a number of private label categories, including cereal, pasta, crackers, jellies/jams, syrups, frozen waffles and other products.The combination of ConAgra Foods' approximately $850 million private label business with Ralcorp would result in approximately $4 billion in combined annual private label sales. To finance the proposed $86 per share all-cash transaction, ConAgra Foods will use cash on hand and plans to issue debt. The company is committed to its investment grade credit rating. ConAgra Foods believes that the combined company would continue to generate strong cash flow and remains committed to a strong dividend.Additional information regarding the benefits of the proposed transaction can be found on www.transactioninfo.com/conagrafoods.

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