Details of the Transaction
Flowers has agreed to acquire Lepage Bakeries, Inc. and certain affiliated companies for a total purchase price of $370 million. The transaction will be accomplished through:
- The purchase by a wholly-owned subsidiary of Flowers of all the issued and outstanding shares of Lepage Bakeries, Inc. and certain of its affiliates in exchange for $300 million in cash at closing and $20 million in total deferred cash payments beginning on the fourth anniversary of the closing date; and
- The merger of certain other affiliates of Lepage with and into a second wholly-owned subsidiary of Flowers in exchange for a number of shares of Flowers' common stock, par value $.01 per share, valued at $50 million.
The cash component of the transaction will be funded with a combination of cash on hand and existing credit facilities. The transaction is subject to customary conditions, including receipt of required regulatory approvals.
Analysts Conference CallFlowers Foods will host a conference call at 9:00 a.m. (Eastern) on May 31, 2012 to discuss the pending transaction with investors. The call will be broadcast live on Flowers' Web site, www.flowersfoods.com, and can be accessed by clicking on the webcast link on the home page. The call also will be archived on the company's Web site. Background on Lepage Bakeries Lepage Bakeries, founded in 1903, combines more than 100 years of baking tradition with state-of-the-art baking operations to deliver great-tasting, high-quality breads, rolls, and donuts to customers throughout the Northeastern U.S. sold under the Country Kitchen and Barowsky's brands. Lepage Bakeries is dedicated to being the most consistent, productive, and respected baking company; to exceeding customer expectations; and to providing economic opportunity for all its associates. Background on Flowers Foods (NYSE: FLO) Headquartered in Thomasville, Ga., Flowers Foods is the second largest producer and marketer of packaged bakery foods for retail and foodservice customers in the United States with 2011 sales of $2.8 billion. Flowers operates 41 bakeries that produce a wide range of bakery products sold through an extensive direct-store-delivery network that encompasses the Southeast, Mid-Atlantic, and Southwest as well as select markets in the Northeast, California and Nevada, and nationwide through other delivery systems. Among the company's top brands are Nature's Own, Whitewheat, Tastykake, and Mrs. Freshley's. Statements contained in this press release that are not historical facts are forward-looking statements. All forward-looking statements are subject to risks and uncertainties that could cause actual results to differ from those projected. Other factors that may cause actual results to differ from the forward-looking statements contained in this release and that may affect the company's prospects in general include, but are not limited to, (a) competitive conditions in the baked foods industry, including promotional and price competition, (b) changes in consumer demand for our products, (c) the success of productivity improvements and new product introductions, (d) a significant reduction in business with any of our major customers including a reduction from adverse developments in any of our customer's business, (e) fluctuations in commodity pricing, (f) our ability to fully integrate recent acquisitions into our business, and (g) our ability to achieve cash flow from capital expenditures and acquisitions and the availability of new acquisitions that build shareholder value. In addition, our results may also be affected by general factors such as economic and business conditions (including the baked foods markets), interest and inflation rates and such other factors as are described in the company's filings with the Securities and Exchange Commission.
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