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Smithfield Foods to acquire Sara Lee's European meats business

Smithfield Foods, Inc., today announced that it has signed a purchase agreement to acquire the European meats business of Sara Lee Corporation for $575 million. The deal is expected to close by the end of September.

Sara Lee's European meats business generated $1.1 billion in sales in fiscal 2005 and holds its largest positions in France, Portugal and the Benelux region, with popular European brands such as Aoste, Justin Bridou and Nobre. The company also has a presence in Germany, Italy and the United Kingdom.

As part of the deal -- which is subject to customary regulatory and closing conditions -- Smithfield agrees also to assume Sara Lee's pension-related liabilities in an amount not to exceed $39 million. Smithfield intends to complete and finance the acquisition of Sara Lee's European meats business on a stand-alone, non-recourse basis through a 50% owned joint venture with Oaktree Capital Management, LLC.

Smithfield says it will contribute its Jean Caby operations to the joint venture with Oaktree. Group Jean Caby had sales of $372 million in fiscal 2006 and is a major producer of branded and private label processed meats to retail and foodservice customers in France and other European countries.

Smithfield Foods, Inc., today announced that it has signed a purchase agreement to acquire the European meats business of Sara Lee Corporation for $575 million. The deal is expected to close by the end of September.

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