The J. M. Smucker Company (NYSE: SJM) and The Procter & Gamble Company (NYSE: PG) Folgers unit have confirmed yesterday’s reports that the two companies are going to merge. The Folgers coffee business was going to be spun-out of P&G already, and this will more quickly exact that transaction.
Folgers will merge into The J. M. Smucker Company in an all-stock "reverse Morris Trust" transaction valued at approximately $3.3 billion. This number includes an estimated $350 million of Folgers debt.
As part of this transaction, Smucker is going to issue a one-time special dividend of $5.00 per share to current Smucker shareholders as of the record date ahead of this merger. Following the one-time dividend, P&G shareholders will receive approximately 53.5% of Smucker in a tax-free stock-for-stock merger.
The company believes that the deal will be accretive in 2009, assuming a 2008 deal closing date with Folgers contributing $80 million in net income and $820 million in EBITDA. The company sees a combined 2009 estimated sales number of $4 Billion, with earnings per share before one-time items at $3.45 to $3.50 EPS. For 2010, it sees $3.62 EPS.
You can join our open email distribution list to hear about other mergers, special financings, IPO’s, secondary offerings, restructurings, and other special situations.
Jon C. Ogg
June 4, 2008
Take This Retirement Quiz To Get Matched With An Advisor Now (Sponsored)
Are you ready for retirement? Planning for retirement can be overwhelming, that’s why it could be a good idea to speak to a fiduciary financial advisor about your goals today.
Start by taking this retirement quiz right here from SmartAsset that will match you with up to 3 financial advisors that serve your area and beyond in 5 minutes. Smart Asset is now matching over 50,000 people a month.
Click here now to get started.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
