Kraft 2006 Annual Report Download - page 37

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represent the preliminary allocation of purchase price and are subject to revision when appraisals are finalized, which is expected to occur during the first half of
2007.
During 2006, the Company sold its rice brand and assets, and its industrial coconut assets. The Company also sold its pet snacks brand and assets in 2006
and recorded tax expense of $57 million related to the sale. In addition, the Company incurred a pre-tax asset impairment charge of $86 million in 2006 in
recognition of this sale. Additionally, during 2006, the Company sold certain Canadian assets and a small U.S. biscuit brand, and incurred pre-tax asset
impairment charges of $176 million in 2005 in recognition of these sales. Also during 2006, the Company sold a U.S. coffee plant. The aggregate proceeds
received from these sales were $946 million, on which the Company recorded pre-tax gains of $117 million.
In January 2007, the Company announced the sale of its hot cereal assets and trademarks. In recognition of the anticipated sale, the Company recorded a
pre-tax asset impairment charge of $69 million in 2006 for these assets.
As previously discussed, the Company sold substantially all of its sugar confectionery business in June 2005 for pre-tax proceeds of approximately
$1.4 billion. The sale included theLife Savers,Creme Savers,Altoids,Trolli andSugus brands. The Company has reflected the results of its sugar confectionery
business prior to the closing date as discontinued operations on the consolidated statements of earnings. The Company recorded a loss on sale of discontinued
operations of $297 million in the second quarter of 2005, related largely to taxes on the transaction.
During 2005, the Company sold its fruit snacks assets, and incurred a pre-tax asset impairment charge of $93 million in recognition of this sale.
Additionally, during 2005, the Company sold its U.K. desserts assets, its U.S. yogurt assets, a small business in Colombia, a minor trademark in Mexico and a
small equity investment in Turkey. The aggregate proceeds received from these sales were $238 million, on which the Company recorded pre-tax gains of
$108 million.
During 2004, the Company sold a Brazilian snack nuts business and trademarks associated with a candy business in Norway. The aggregate proceeds
received from the sales of these businesses were $18 million, on which pre-tax losses of $3 million were recorded.
During 2004, the Company acquired a U.S.-based beverage business for a total cost of $137 million.
The operating results of the businesses acquired and sold, other than the UB acquisition and the divestiture of the sugar confectionery business, in the
aggregate, were not material to the Company's consolidated financial position, results of operations or cash flows in any of the periods presented.
33
Source: KRAFT FOODS INC, 10-K, March 01, 2007