The merger provides investors with a compelling financial story and
further strengthens Smucker's ability to deliver enhanced shareholder value
over time. Smucker believes that the addition of the Folgers business will
benefit Smucker and its shareholders in several important ways, as detailed
-- Assuming Folgers was owned for all of Smucker's fiscal year 2009:
-- Net sales are expected to increase to approximately $4.7 billion.
-- It is estimated that the transaction would be accretive by
approximately 9 percent to fiscal year 2009 earnings per share,
excluding merger and integration costs, and after giving effect to
the impact of the special dividend to Smucker shareholders, as
discussed in Transaction Details below.
-- Smucker expects to realize synergies in excess of $80 million.
-- The profit contribution from Folgers and fully realized synergies
of over $80 million are expected to result in estimated earnings
before interest, taxes, depreciation, and amortization ("EBITDA")
of $820 million. This represents an increase in the EBITDA margin
of nearly 300 basis points.
-- Results for fiscal year 2009 will depend on the actual closing date.
Assuming the transaction closes early in the fourth quarter of calendar
-- Fiscal 2009 net sales are estimated to approximate $4 billion.
-- Fiscal 2009 earnings per share, before one-time costs associated
with the transaction, are estimated to range from $3.45 to $3.50.
-- Fiscal 2010 earnings per share, before one-time costs associated
with the transaction, are estimated to range from $3.62 to $3.72.
|SOURCE The J. M. Smucker Company; The Procter & Gamble Company|
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