Kraft Foods unveils plans to sell off Post cereals
NORTHFIELD, Ill. In a statement released Monday, Kraft Foods’ board of directors announced the company’s plan to sell-off all outstanding shares of Cable Holdco, the Kraft subsidiary responsible for the company’s Post cereals business.
Kraft announced that it had entered into a definitive agreement to distribute and merge its Post cereals into Ralcorp Nov. 15, 2007. But news of the split-off was announced in connection with the merger of Cable Holdco and Ralcorp Mailman LLC, a subsidiary of Ralcorp Holdings.
The exchange is expected to be tax-free to Kraft shareholders for U.S. tax purposes. The offer will expire at the closing date of Post/Ralcorp merger. That date should be announced in the coming weeks. The transactions face regular closing procedures one of which is approval by Ralcorp’s shareholders.
Kraft shareholders will also be granted the choice whether to exchange Kraft shares for Cable Holdco common stock, [then immediately exchanged for shares of Ralcorp common stock, just after the Cable Holdco/Ralcorp Mailman merger]. Outstanding shares of Kraft will be reduced as a consequence.
About 30.4 million shares of Cable Holdco will be offered in trade for Kraft common stock. Other conditions apply to the exchange, as well.
Hershey tuning its ears to customer comments, sets plan for long-term net sales boost
HERSHEY, Pa. The Hershey Co. said it will announce its plan for meeting long-term for net sales goals and increasing earnings per share growth today. The company said that a new plan was developed after Hershey completed a market structure/category segmentation review. The company will also realign its plans to focus on the interests of key consumer segments to help drive growth.
Hershey said it is readjusting its resources and plans to beef up its advertising by about 20 percent in 2008 and 2009. A focus will be directed on core brands currently generating around 60 percent of the company’s U.S. net sales.
“Our extensive consumer research validates our strategy of increasing advertising and consumer investment behind the core U.S. brands that offer the greatest potential for growth,” David J. West, president and chief executive officer said. “We will combine this focused approach with consumer-centric innovation and continued international expansion to achieve our long-term net sales growth rate of 3 to 5 percent. Longer term, as marketplace trends improve and targeted consumer initiatives are executed, the Company expects to generate earnings per share growth of 6 to 8 percent.”
Hershey has said that it estimates its total net growth for 2008 to be at around 3 to 4 percent. Earnings per share were expected to be around $1.85 to $1.90. Hershey’s management planned to discuss the new strategy and long-term goals at a meeting with investors earlier this morning.
Coca-Cola announces debut of new bottle design in select cities
BIRMINGHAM, Ala., and CHATTANOOGA, Tenn. Two U.S. cities will be the launch sites of Coca-Cola’s newly redesigned, “iconic contour” two-liter bottle, Coca-Cola Company has said.
Coca-Cola said that it selected Birmingham and Chattanooga to launch the contoured bottles because of their “long-standing loyalty to the soft drink,” and because bottler Coca-Cola United is located in Birmingham.
Coca-Cola also said the new “iconic” shape of the two-liter bottle was selected over a straight version in consumer tests. The company said that consumers reported the contoured bottle is easier to hold and pour from, and they said the new design would boost sales.
The new bottle debuts in stores today. All of Coca-Cola’s brands will soon be available in the new bottle.