Northfield, Ill., Aug. 1 - Kraft Foods Inc. today announced that the final exchange ratio for the tax-efficient split-off of its Post cereals business is set at 0.6606 shares of Cable Holdco, Inc. common stock for each Kraft common share validly tendered and not withdrawn pursuant to the exchange offer. As previously announced, Kraft entered into a definitive agreement on November 15, 2007, to distribute and merge its Post cereals business into Ralcorp.
The split-off transaction is in connection with the merger of Cable Holdco, a wholly owned subsidiary of Kraft that will own certain assets and liabilities of the Post cereals business, and a subsidiary of Ralcorp Holdings, Inc.
In this split-off transaction, Kraft shareholders have the option to exchange their shares of Kraft common stock for shares of Cable Holdco common stock. The Cable Holdco common stock will then immediately be exchanged for shares of Ralcorp common stock on a one-for-one basis following the merger of Cable Holdco and a Ralcorp subsidiary. Ultimately, at the conclusion of this exchange offer and the subsequent merger of Cable Holdco and a subsidiary of Ralcorp, Kraft shareholders will own 0.6606 shares of Ralcorp for each Kraft share exchanged. The exchange is expected to be tax-free to participating Kraft shareholders for U.S. federal income tax purposes.
The exchange offer will expire at 8:00 a.m., New York City time, on August 4, 2008, and will coincide with the closing of the merger of the Post cereals business and Ralcorp. The transactions are subject to customary closing conditions.
A total of 30,466,805 shares of Cable Holdco are being offered in exchange for Kraft common stock, subject to adjustments in certain circumstances.
Based on the final exchange ratio and no adjustments to the amount of Cable Holdco shares being offered, Kraft will accept for exchange a maximum of 46,119,899 Kraft common shares. The exchange offer will be subject to proration if more than 46,119,899 Kraft common shares are validly tendered and not withdrawn. If the exchange offer is consummated but not fully subscribed, then the remaining shares of Cable Holdco common stock owned by Kraft will be distributed as a pro rata dividend to Kraft shareholders.
ABOUT KRAFT FOODS INC.
For more than a century, Kraft has offered delicious foods and beverages that fit the way consumers live. Today, we are turning the brands that consumers have lived with for years into brands they can't live without. Millions of times a day in more than 150 countries, consumers reach for their favorite Kraft brands, including nine with revenues exceeding $1 billion: Kraft cheeses, dinners and dressings; Oscar Mayer meats; Philadelphia cream cheese; Maxwell House coffee; Nabisco cookies and crackers and its Oreo brand; Jacobs coffees; Milka chocolates; and LU biscuits. Kraft is one of the world's largest food and beverage companies with annual revenues exceeding $37 billion, more than 100,000 employees and more than 180 manufacturing and processing facilities globally. The company is a member of the Standard & Poor's 500 index as well as the Dow Jones Sustainability Index and Ethibel Sustainability Index.