Sara Lee Announces Results of Cash Tender Offer as of Early Tender Date and Elimination of Series-Specific Tender Caps; Tende...

 
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Sara Lee Corp. ("Sara Lee") (NYSE: SLE) today announced that, pursuant to its previously announced cash tender offer, approximately $888.6 million in aggregate principal amount of notes subject to the tender offer was validly tendered and not withdrawn on or before the "Early Tender Date," which was 5:00 p.m., Eastern time, on March 19, 2012, according to information provided by D.F. King & Co., Inc., the tender agent for the tender offer, as more fully set forth below.

Sara Lee also announced that it has eliminated the series-specific tender caps for the tender offer, in which it has offered to purchase, subject to certain conditions, up to $470 million combined aggregate principal amount of its 6 1/8% Notes due 2032, 4.10% Notes due 2020 and 2.75% Notes due 2015 (collectively, the "notes"). Except as amended by this news release, all terms and conditions of the tender offer as described in the Offer to Purchase dated March 6, 2012 and a related Letter of Transmittal remain unchanged.

 
Title of    CUSIP Number   Aggregate      Tender Cap   Acceptance   Principal      Percentage 
Security                   Principal                   Priority     Amount         ofOutstanding 
                           Amount                      Level        Tendered       Amount 
                           Outstanding                                             Tendered 
6           803111 AM5     $500,000,000   N/A          1            $347,784,000   69.56% 
1/8% 
Notesdue 
2032 
4.10%       803111 AS2     $400,000,000   N/A          2            $259,854,000   64.96% 
Notesdue 
2020 
2.75%       803111 AR4     $400,000,000   N/A          3            $280,969,000   70.24% 
Notesdue 
2015 
 
 

The tender offer will expire on the "Expiration Date," which is 12:00 midnight, Eastern time, at the end of April 2, 2012, unless extended. The amounts of each series of notes that are purchased in the tender offer will be determined in accordance with the acceptance priority levels set forth in the Offer to Purchase and referenced in the table above, with 1 being the highest acceptance priority level and 3 being the lowest acceptance priority level. All notes validly tendered and not validly withdrawn in the tender offer having a higher acceptance priority level will be accepted before any tendered notes having a lower acceptance priority level are accepted in the tender offer. Notes of the series in the lowest acceptance priority level accepted for purchase in accordance with the terms and conditions of the tender offer will be subject to proration so that Sara Lee will only accept for purchase notes up to a combined aggregate principal amount of $470,000,000. Accordingly, as described in the Offer to Purchase, as amended hereby, notes with acceptance priority level 3, the 2.75% Notes due 2015, are not expected to be accepted for purchase pursuant to the tender offer, based upon the amount of notes with acceptance priority levels 1 and 2 validly tendered and not withdrawn on or before the Early Tender Date.

Holders of notes subject to the tender offer who validly tendered and did not validly withdraw their notes on or before the Early Tender Date will receive the Total Consideration, which includes an Early Tender Premium of $30 per $1,000 principal amount of notes tendered by such holders that are accepted for purchase. Holders of notes who validly tender their notes after the Early Tender Date and on or before the Expiration Date will receive the Tender Consideration per $1,000 principal amount of notes tendered by such holders that are accepted for purchase, which is equal to the applicable Total Consideration minus the applicable Early Tender Premium of $30 per $1,000 principal amount of notes.

The Total Consideration for each $1,000 principal amount of notes tendered and accepted for purchase pursuant to the tender offer will be determined in the manner described in the Offer to Purchase by reference to a fixed spread specified for each series of the notes over the yield based on the bid side price of the U.S. Treasury Security specified on the cover page of the Offer to Purchase, as calculated by the Lead Dealer Managers at 1:00 p.m., Eastern time, on March 20, 2012. Holders whose notes are accepted for purchase pursuant to the tender offer will also receive accrued and unpaid interest on their purchased notes from the last interest payment date for such notes to, but excluding, the Settlement Date. Subject to the terms and conditions of the tender offer, the Settlement Date will follow promptly after the Expiration Date and currently is expected to be Tuesday, April 3, 2012.

Sara Lee has retained Goldman, Sachs & Co. and Morgan Stanley & Co. LLC to serve as the Lead Dealer Managers for the tender offer. Sara Lee has retained BNP Paribas Securities Corp., Lloyds Securities Inc., Mitsubishi UFJ Securities (USA), Inc. and RBS Securities Inc. to serve as the Co-Dealer Managers for the tender offer. Goldman, Sachs & Co. may be contacted at [phone] (toll free) or [phone] (collect) and Morgan Stanley & Co. LLC may be contacted at [phone] (toll free) or [phone] (collect). Sara Lee has also retained D.F. King & Co., Inc. to serve as the Tender Agent and the Information Agent for the tender offer.

This press release is not a tender offer to purchase or a solicitation of acceptance of a tender offer, which may be made only pursuant to the terms of the Offer to Purchase and the Letter of Transmittal. The tender offer does not constitute an offer to purchase notes in any jurisdiction in which, or to or from any person to or from whom, it is unlawful to make such offer or solicitation under applicable securities or blue sky laws. None of Sara Lee, the Tender Agent, the Information Agent, any of the Dealer Managers or the trustee for the notes is making any recommendation as to whether holders should tender notes in the tender offer.

Any questions or requests for assistance or additional copies of the Offer to Purchase and the Letter of Transmittal may be directed to D.F. King & Co., Inc. by telephone at [phone] (toll free), or in writing at 48 Wall Street, 22nd Floor, New York, NY, 10005, Attention: Elton Bagley. You may also contact your broker, dealer, commercial bank or trust company or other nominee for assistance concerning the tender offer.

Forward Looking Statements

This release contains forward-looking statements with respect to the timing and principal amount of debt securities to be purchased in the cash tender offer, including certain terms and conditions of the cash tender offer. The Offer to Purchase and other documents and statements of Sara Lee contain certain forward-looking statements, including the anticipated costs and benefits of restructuring, transformation and actions associated with Sara Lee's Project Accelerate initiative, other matters related to Sara Lee's spin-off plans, access to credit markets and Sara Lee's credit ratings, the planned extinguishment of debt (including through the tender offer), the funding of pension plans, potential payments under guarantees and amounts due under future contractual obligations and commitments, projected capital expenditures, cash tax payments, pension settlement amounts and effective tax rates. In addition, from time to time, in oral statements and written reports, Sara Lee discusses its expectations regarding its future performance by making forward-looking statements preceded by terms such as "expects," "projects," "anticipates" or "believes." These forward-looking statements are based on currently available competitive, financial and economic data, as well as management's views and assumptions regarding future events. Such forward-looking statements are inherently uncertain, and investors must recognize that actual results may differ from those expressed or implied in the forward-looking statements. Consequently, Sara Lee wishes to caution readers not to place undue reliance on any forward-looking statements. Among the factors that could cause Sara Lee's actual results to differ from such forward-looking statements are those described in Sara Lee's Annual Report on Form 10-K for the fiscal year ended July 2, 2011, as well as factors relating to:

 
 
    -- Sara Lee's proposed spin-off plans and the related special dividend, 

such as (i) unanticipated developments that delay or negatively impact

the proposed spin-off and capital plans; (ii) the anticipated costs

and benefits of restructuring actions taken to prepare for the

spin-off; (iii) Sara Lee's ability to obtain customary approvals; (iv)

Sara Lee's ability to generate the anticipated efficiencies and

savings from the spin-off including a lower effective tax rate for the

spun-off company; (v) the impact of the spin-off on Sara Lee's

relationships with its employees, major customers and vendors and on

Sara Lee's credit ratings and cost of funds; (vi) changes in market

conditions; (vii) future opportunities that Sara Lee's board of

directors may determine present greater potential value to

shareholders than the spin-off and special dividend; (viii) disruption

to Sara Lee's business operations as a result of the spin-off; (ix)

future operating or capital needs that require a more significant

outlay of cash than currently anticipated; and (x) the ability of the

businesses to operate independently following the completion of the

spin-off;

 
    -- Sara Lee's relationship with its customers, such as (i) a significant 

change in Sara Lee's business with any of its major customers, such as

Walmart, its largest customer; and (ii) credit and other business

risks associated with customers operating in a highly competitive

retail environment;

 
    -- The consumer marketplace, such as (i) intense competition, including 

advertising, promotional and price competition; (ii) changes in

consumer behavior due to economic conditions, such as a shift in

consumer demand toward private label; (iii) fluctuations in raw

material costs, Sara Lee's ability to increase or maintain product

prices in response to cost fluctuations and the impact on Sara Lee's

profitability; (iv) the impact of various food safety issues and

regulations on sales and profitability of Sara Lee products; and (v)

inherent risks in the marketplace associated with product innovations,

including uncertainties about trade and consumer acceptance;

 
    -- Sara Lee's international operations, such as (i) impacts on reported 

earnings from fluctuations in foreign currency exchange rates,

particularly the euro; (ii) Sara Lee's generation of a high percentage

of its revenues from businesses outside the United States and costs to

remit these foreign earnings into the U.S. to fund Sara Lee's domestic

operations, dividends, debt service and corporate costs; (iii)

difficulties and costs associated with complying with U.S. laws and

regulations, such as Foreign Corrupt Practices Act, applicable to

global corporations, and different regulatory structures and

unexpected changes in regulatory environments overseas; and (iv) Sara

Lee's ability to continue to source production and conduct operations

in various countries due to changing business conditions, political

environments, import quotas and the financial condition of suppliers;

and

 
    -- previous business decisions, such as (i) Sara Lee's ability to 

generate margin improvement through cost reduction and efficiency

initiatives; (ii) Sara Lee's credit ratings, the impact of Sara Lee's

capital plans on such credit ratings and the impact these ratings and

changes in these ratings may have on Sara Lee's cost to borrow funds

and access to capital/debt markets; (iii) the settlement of a number

of ongoing reviews of Sara Lee's income tax filing positions in

various jurisdictions and inherent uncertainties related to the

interpretation of tax regulations in the jurisdictions in which Sara

Lee transacts business; and (iv) changes in the expense for and

contingent liabilities relating to multi-employer pension plans in

which Sara Lee participates.

In addition, Sara Lee's results may also be affected by general factors, such as economic conditions, political developments, interest and inflation rates, accounting standards, taxes and laws and regulations in markets where Sara Lee competes. Sara Lee undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

About Sara Lee Corporation

Sara Lee Corp. (NYSE: SLE) and its leading portfolio of food and beverage brands, including Ball Park, Douwe Egberts, Hillshire Farm, Jimmy Dean, Pickwick Teas, Sara Lee and Senseo, generate nearly $8 billion in annual net sales from continuing operations and employ approximately 20,000 people worldwide. In January 2011, Sara Lee Corp. announced that it will divide the company into two pure-play publicly-traded companies, one focused on the international coffee and tea market and the other on North American meats. For more information on the company, please visit www.saralee.com.

Sara Lee Corp.Media:Mike Cummins, +1.630.598.8412Analysts:Melissa Napier, +1.630.598.8739