J.M. Smucker buys Folgers for $2.95 billion

Source: FoodProcessing.com

Jun 04, 2008

Associated Press

Jams and jellies maker J.M. Smucker made a $2.95 billion bid for more of the breakfast table June 4, announcing all-stock deal for Folgers coffee.

Smucker also will assume about $350 million of Folgers' debt in a buyout from the current owner, Procter & Gamble Co.

Smucker will issue a special $5 dividend to Smucker shareholders at a to-be-determined record date, before the acquisition. P&G shareholders will receive about 53.5 percent of Smucker in a tax-free stock-for-stock acquisition after the dividend.

J.M. Smucker Co. expects the acquisition will boost profits by about 9 percent, excluding costs, if it owns the brand for the entire 2009 fiscal year. The company expects sales to increase to about $4.7 billion.

The deal with Cincinnati-based P&G is expected to close in the fourth quarter.

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