Kraft 2009 Annual Report Download - page 72

The following assets of the Post cereals business were included in the Post split-off (in millions):
Inventories, net $ 94
Property, plant and equipment, net 425
Goodwill 1,234
Other assets 11
Other liabilities (3)
Distributed assets of the Post cereals
business $ 1,761
LU Biscuit Acquisition:
On November 30, 2007, we acquired the Groupe Danone S.A. global LU biscuit business (“LU Biscuit”) for € 5.1 billion (approximately $7.6 billion)
in cash. The acquisition included 32 manufacturing facilities and approximately 14,000 employees. During 2008, we repaid Groupe Danone S.A.
for excess cash received upon the acquisition. LU Biscuit reports results from operations on a one month lag; accordingly, there was no effect on
our 2007 operating results. On a proforma basis, LU Biscuit would have contributed net revenues of $2.8 billion during 2007, and LU Biscuit’s
contribution to net earnings would have been insignificant to Kraft Foods.
Other Divestitures:
In 2009, we received $41 million in net proceeds and recorded pre-tax losses of $6 million on the divestitures of our Balance bar operations in the
U.S., a juice operation in Brazil and a plant in Spain. We recorded after-tax gains of $58 million on these divestitures, primarily due to the differing
book and tax bases of our Balance bar operations.
In 2008, we received $153 million in net proceeds, and recorded pre-tax losses of $92 million on divestitures, primarily related to a Nordic and
Baltic snacks operation and four operations in Spain. We recorded after-tax losses of $64 million on these divestitures.
Included in the 2008 divestitures were the following, which were a condition of the EU Commission’s approval of our LU Biscuit acquisition:
• We divested a biscuit operation in Spain. From this divestiture, we received $86 million in net proceeds and recorded pre-tax losses of
$74 million.
• We divested another biscuit operation in Spain and a trademark in Hungary that we had previously acquired as part of the LU Biscuit
acquisition. As such, the impacts of these divestitures were reflected as adjustments to the purchase price allocations.
In 2007, we received $216 million in net proceeds and recorded pre-tax gains of $14 million on the divestitures of our hot cereal assets and
trademarks, our sugar confectionery assets in Romania and related trademarks and our flavored water and juice brand assets and related
trademarks, including Veryfine and Fruit2O. We recorded an after-tax loss of $5 million on these divestitures to reflect the differing book and tax
bases of our hot cereal assets and trademarks divestiture.
These gains and losses on divestitures do not reflect the related asset impairment charges discussed in Note 5, Goodwill and Intangible Assets.
The aggregate operating results of the divestitures discussed above, other than the divestiture of the Post cereals business, were not material to
our financial statements in any of the periods presented. Refer to Note 16, Segment Reporting, for details of the gains and losses on divestitures
by segment.
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Source: KRAFT FOODS INC, 10-K, February 25, 2010 Powered by Morningstar® Document Research℠