UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 2, 2015
MONDELĒZ INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
| Virginia | 1-16483 | 52-2284372 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
Three Parkway North, Deerfield, Illinois 60015
(Address of principal executive offices, including zip code)
(847) 943-4000
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.01. Completion of Acquisition or Disposition of Assets.
On July 2, 2015, Mondelēz International, Inc. completed transactions to combine our wholly owned coffee businesses (including our coffee portfolio in France) with those of D.E Master Blenders 1753 B.V. (“DEMB”) to create a new company, Jacobs Douwe Egberts (“JDE”).
Upon closing, the consideration we received for our coffee businesses was €3.8 billion ($4.2 billion U.S. dollars as of July 2, 2015) and a 43.5 percent equity interest in JDE. Acorn Holdings B.V., owner of DEMB, holds a 56.5% share in JDE. The cash and equity consideration we received was adjusted from previous estimates to reflect our retaining our interest in a Korea-based joint venture, Dongsuh Foods Corporation. During the second quarter of 2015, we also completed the sale of our interest in a Japanese coffee joint venture, Ajinomoto General Foods, Inc. (“AGF”). In lieu of contributing our interest in the AGF joint venture to JDE, we contributed the net cash proceeds from the sale, and the transaction did not change the consideration received for our global coffee businesses.
The total amount of cash and equity consideration we expect to receive is subject to further adjustment based on the final valuation, net assets and shares in our businesses contributed to JDE and final sales price adjustments. We expect to finalize the sales price and related adjustments by the end of the second quarter of 2016. As a result, the final amount of consideration we receive and the gain we recognize on the divestiture may change materially until we conclude these matters.
Following the transactions, Mondelēz International is an even more focused snacking company, with approximately 85% of net revenues derived from biscuits, chocolate, gum and candy. By retaining a significant stake in JDE, we will also continue to have a significant contribution from the coffee category. We plan to reflect our divested historical coffee results and future equity earnings from JDE in results from continuing operations as the coffee category continues to be a significant part of our strategy and net earnings.
Our unaudited pro forma financial information giving effect to the divestiture of our global coffee business is attached as Exhibit 99.1.
Item 7.01. Regulation FD Disclosure.
On July 2, 2015, we and DEMB issued a joint press release announcing the completion of the coffee business transactions. A copy of the press release is furnished as Exhibit 99.2.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit Number |
Description | |
| 10.1 | Global Contribution Agreement by and among Mondelēz International Holdings, LLC, Acorn Holdings B.V., Charger Top HoldCo B.V. and Charger OpCo B.V., dated May 7, 2014 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on August 8, 2014).* | |
| 10.2 | Shareholders’ Agreement by and among Mondelēz International Holdings, LLC, Delta Charger HoldCo B.V. and Charger Top HoldCo B.V., dated May 7, 2014 (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on August 8, 2014).* | |
| 99.1 | Unaudited Pro Forma Consolidated Financial Information and accompanying notes. | |
| 99.2 | Press Release, dated July 2, 2015. | |
| * | Portions of this exhibit (indicated by asterisks) have been omitted pursuant to a request for confidential treatment and have been separately filed with the SEC. |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| MONDELĒZ INTERNATIONAL, INC. | ||
Date: July 8, 2015
| /s/ Brian T. Gladden | ||||
| Name: | Brian T. Gladden | |||
| Title: | Executive Vice President and Chief Financial Officer | |||
EXHIBIT INDEX
| Exhibit Number |
Description | |
| 10.1 | Global Contribution Agreement by and among Mondelēz International Holdings, LLC, Acorn Holdings B.V., Charger Top HoldCo B.V. and Charger OpCo B.V., dated May 7, 2014 (incorporated by reference to Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on August 8, 2014).* | |
| 10.2 | Shareholders’ Agreement by and among Mondelēz International Holdings, LLC, Delta Charger HoldCo B.V. and Charger Top HoldCo B.V., dated May 7, 2014 (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q filed with the SEC on August 8, 2014).* | |
| 99.1 | Unaudited Pro Forma Consolidated Financial Information and accompanying notes. | |
| 99.2 | Press Release, dated July 2, 2015. | |
| * | Portions of this exhibit (indicated by asterisks) have been omitted pursuant to a request for confidential treatment and have been separately filed with the SEC. |
Exhibit 99.1
Mondelēz International, Inc.
Unaudited Pro Forma Consolidated Financial Information
Divestiture of Mondelēz International Coffee Business
On July 2, 2015 (the “closing date”), Mondelēz International, Inc. completed transactions to combine our wholly owned coffee businesses (including our coffee portfolio in France) with those of D.E Master Blenders 1753 B.V. (“DEMB”) to create a new company, Jacobs Douwe Egberts (“JDE”).
Upon closing, the consideration we received for our coffee businesses was €3.8 billion ($4.2 billion U.S. dollars as of July 2, 2015) and a 43.5 percent equity interest in JDE. Acorn Holdings B.V. (“AHBV”), owner of DEMB, holds a 56.5% share in JDE. The cash and equity consideration we received was adjusted from previous estimates to reflect our retaining our interest in a Korea-based joint venture, Dongsuh Foods Corporation (“DSF”). During the second quarter of 2015, we also completed the sale of our interest in a Japanese coffee joint venture, Ajinomoto General Foods, Inc. (“AGF”). In lieu of contributing our interest in the AGF joint venture to JDE, we contributed the net cash proceeds from the sale, and the transaction did not change the consideration received for our global coffee businesses.
The total amount of cash and equity consideration we expect to receive is subject to further adjustment based on the final valuation, net assets and shares in our businesses contributed to JDE and final sales price adjustments. We expect to finalize the sales price and related adjustments by the end of the second quarter of 2016. As a result, the final amount of consideration we receive and the gain we recognize on the divestiture may change materially until we conclude these matters.
Following the transactions, Mondelēz International is an even more focused snacking company, with approximately 85% of net revenues derived from biscuits, chocolate, gum and candy. By retaining a significant stake in JDE, we will also continue to have a significant contribution from the coffee category. We plan to reflect our divested historical coffee results and future equity earnings from JDE in results from continuing operations as the coffee category continues to be a significant part of our strategy and net earnings.
Based on the size of our global coffee divestiture relative to our consolidated results, we have reflected the divestiture in the unaudited pro forma consolidated financial information and reflected the receipt of consideration, including the 43.5% equity interest in JDE, as of the pro forma consolidated balance sheet date of March 31, 2015.
Unaudited Pro Forma Consolidated Financial Information
The following unaudited pro forma consolidated financial statements reflect adjustments to our historical financial results related to the divestiture of our global coffee business:
| • | the unaudited pro forma consolidated statements of earnings for the three months ended March 31, 2015 and the year ended December 31, 2014 give effect to the divestiture as if it occurred on January 1, 2014, the beginning of the earliest period presented; and |
| • | the unaudited pro forma consolidated balance sheet gives effect to the divestiture as if it occurred as of March 31, 2015, our latest balance sheet date provided in our public filings. |
The unaudited pro forma consolidated statements of earnings (i) are presented based on information currently available, (ii) are intended for informational purposes only, (iii) are not necessarily indicative of and do not purport to represent what our operating results would have been had the divestiture occurred as described or what our future operating results will be after giving effect to these events, and (iv) do not reflect all actions that may be undertaken by management after the divestiture of our coffee business.
The unaudited pro forma consolidated financial statements and the accompanying notes should be read together with (i) the audited consolidated financial statements and accompanying notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2014, and (ii) the unaudited interim consolidated financial statements and accompanying notes and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2015.
1
Mondelēz International, Inc.
Unaudited Pro Forma Consolidated Statement of Earnings
For the Three Months Ended March 31, 2015
(in millions, except per share data)
| As Reported Mondelēz International(1) |
Divestiture of Coffee Business (d) |
Pro Forma Adjustments |
Notes | Pro Forma Mondelēz International(1) |
||||||||||||||
| Net revenues |
$ | 7,762 | $ | (752 | ) | $ | — | $ | 7,010 | |||||||||
| Cost of sales |
4,821 | (460 | ) | (1 | ) | (a) | 4,360 | |||||||||||
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| Gross profit |
2,941 | (292 | ) | 1 | 2,650 | |||||||||||||
| Selling, general and administrative expenses |
1,924 | (162 | ) | (27 | ) | (a), (c) | 1,735 | |||||||||||
| Asset impairment and exit costs |
160 | — | — | 160 | ||||||||||||||
| Amortization of intangibles |
46 | — | — | 46 | ||||||||||||||
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| Operating income |
811 | (130 | ) | 28 | 709 | |||||||||||||
| Interest and other expense, net |
386 | — | 551 | (b) | 937 | |||||||||||||
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| Earnings before income taxes |
425 | (130 | ) | (523 | ) | (228 | ) | |||||||||||
| Provision for income taxes |
113 | (17 | ) | (228 | ) | (a), (b), (c) | (132 | ) | ||||||||||
| Income from equity method investments |
— | — | 113 | (d) | 113 | |||||||||||||
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| Net earnings |
312 | (113 | ) | (182 | ) | 17 | ||||||||||||
| Noncontrolling interest |
(12 | ) | — | — | (12 | ) | ||||||||||||
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| Net earnings attributable to Mondelēz International |
$ | 324 | $ | (113 | ) | $ | (182 | ) | $ | 29 | ||||||||
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| Earnings per share: |
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| Basic |
$ | 0.20 | $ | (0.07 | ) | $ | (0.11 | ) | $ | 0.02 | ||||||||
| Diluted |
$ | 0.19 | $ | (0.07 | ) | $ | (0.11 | ) | $ | 0.02 | ||||||||
| Weighted-average shares: |
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| Basic |
1,648 | 1,648 | ||||||||||||||||
| Diluted |
1,665 | 1,665 | ||||||||||||||||
| (1) | During the three months ended March 31, 2015, in our reported Mondelēz International results, we also incurred significant charges, including a pre-tax $713 million ($452 million after-tax) loss on debt extinguishment and related expenses and pre-tax charges of $224 million ($175 million after-tax) related to our 2014-2018 Restructuring Program. These amounts have not been removed to normalize the results above because they are not directly related to the global coffee divestiture. However, these items did reduce our as reported and pro forma Mondelēz International results above. Refer to our Quarterly Report on Form 10-Q for additional information on items affecting our results for the three months ended March 31, 2015. |
See accompanying notes to the unaudited pro forma consolidated financial statements.
2
Mondelēz International, Inc.
Unaudited Pro Forma Consolidated Statement of Earnings
For the Year Ended December 31, 2014
(in millions, except per share data)
| As Reported Mondelēz International(1) |
Divestiture of Coffee Business (d) |
Pro Forma Adjustments |
Notes | Pro Forma Mondelēz International(1) |
||||||||||||||
| Net revenues |
$ | 34,244 | $ | (3,776 | ) | $ | — | $ | 30,468 | |||||||||
| Cost of sales |
21,647 | (2,321 | ) | — | 19,326 | |||||||||||||
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| Gross profit |
12,597 | (1,455 | ) | — | 11,142 | |||||||||||||
| Selling, general and administrative expenses |
8,457 | (809 | ) | (69 | ) | (a), (c) | 7,579 | |||||||||||
| Asset impairment and exit costs |
692 | — | — | 692 | ||||||||||||||
| Amortization of intangibles |
206 | — | — | 206 | ||||||||||||||
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| Operating income |
3,242 | (646 | ) | 69 | 2,665 | |||||||||||||
| Interest and other expense, net |
688 | — | 628 | (b) | 1,316 | |||||||||||||
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| Earnings before income taxes |
2,554 | (646 | ) | (559 | ) | 1,349 | ||||||||||||
| Provision for income taxes |
353 | (74 | ) | (219 | ) | (a), (b) | 60 | |||||||||||
| Income from equity method investments |
— | — | 572 | (d) | 572 | |||||||||||||
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| Net earnings |
2,201 | (572 | ) | 232 | 1,861 | |||||||||||||
| Noncontrolling interest |
17 | — | — | 17 | ||||||||||||||
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| Net earnings attributable to Mondelēz International |
$ | 2,184 | $ | (572 | ) | $ | 232 | $ | 1,844 | |||||||||
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| Earnings per share: |
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| Basic |
$ | 1.29 | $ | (0.34 | ) | $ | 0.14 | $ | 1.09 | |||||||||
| Diluted |
$ | 1.28 | $ | (0.33 | ) | $ | 0.14 | $ | 1.08 | |||||||||
| Weighted-average shares: |
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| Basic |
1,691 | 1,691 | ||||||||||||||||
| Diluted |
1,709 | 1,709 | ||||||||||||||||
| (1) | During the year ended December 31, 2014, in our reported Mondelēz International results, we also incurred significant charges, including pre-tax charges totaling $840 million ($632 million after-tax) related to our 2014-2018 Restructuring Program and 2012-2014 Restructuring Program, a pre-tax $495 million ($307 million after-tax) loss on debt extinguishment and related expenses and a pre-tax charge of $167 million ($151 million after-tax) related to the remeasurement of our Venezuelan net monetary assets in 2014. These amounts have not been removed to normalize the results above because they are not directly related to the global coffee divestiture. However, these items did reduce our as reported and pro forma Mondelēz International results above. Refer to our Annual Report on Form 10-K for additional information on items affecting our results for the year ended December 31, 2014. |
See accompanying notes to the unaudited pro forma consolidated financial statements.
3
Mondelēz International, Inc.
Unaudited Pro Forma Consolidated Balance Sheet
As of March 31, 2015
(in millions)
| As Reported Mondelēz International |
Divestiture of Coffee Business (d) |
Pro Forma Adjustments |
Notes | Pro Forma Mondelēz International |
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| ASSETS |
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| Cash and cash equivalents |
$ | 1,835 | $ | (208 | ) | $ | 4,207 | (c), (d) | $ | 5,834 | ||||||||
| Trade receivables |
4,061 | (499 | ) | — | 3,562 | |||||||||||||
| Other receivables |
852 | (20 | ) | 488 | (d) | 1,320 | ||||||||||||
| Inventories, net |
3,421 | (530 | ) | — | 2,891 | |||||||||||||
| Deferred income taxes |
557 | (13 | ) | — | 544 | |||||||||||||
| Other current assets |
1,138 | (84 | ) | (95 | ) | (c) | 959 | |||||||||||
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| Total current assets |
11,864 | (1,354 | ) | 4,600 | 15,110 | |||||||||||||
| Property, plant and equipment, net |
9,261 | (716 | ) | — | 8,545 | |||||||||||||
| Goodwill |
22,356 | (1,600 | ) | (65 | ) | (c) | 20,691 | |||||||||||
| Intangible assets, net |
19,434 | — | — | 19,434 | ||||||||||||||
| Prepaid pension assets |
51 | — | — | 51 | ||||||||||||||
| Other assets |
1,240 | (100 | ) | 4,183 | (d) | 5,323 | ||||||||||||
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| TOTAL ASSETS |
$ | 64,206 | $ | (3,770 | ) | $ | 8,718 | $ | 69,154 | |||||||||
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| LIABILITIES |
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| Short-term borrowings |
$ | 3,688 | $ | — | $ | — | $ | 3,688 | ||||||||||
| Current portion of long-term debt |
2,195 | — | — | 2,195 | ||||||||||||||
| Accounts payable |
5,199 | (302 | ) | — | 4,897 | |||||||||||||
| Accrued marketing |
1,872 | (283 | ) | — | 1,589 | |||||||||||||
| Accrued employment costs |
803 | (42 | ) | — | 761 | |||||||||||||
| Other current liabilities |
2,709 | (101 | ) | 509 | (c), (d) | 3,117 | ||||||||||||
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| Total current liabilities |
16,466 | (728 | ) | 509 | 16,247 | |||||||||||||
| Long-term debt |
12,822 | — | — | 12,822 | ||||||||||||||
| Deferred income taxes |
5,373 | (66 | ) | (53 | ) | (c), (d) | 5,254 | |||||||||||
| Accrued pension costs |
2,406 | (166 | ) | 14 | (d) | 2,254 | ||||||||||||
| Accrued postretirement health care costs |
524 | — | — | 524 | ||||||||||||||
| Other liabilities |
2,003 | (5 | ) | — | 1,998 | |||||||||||||
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| TOTAL LIABILITIES |
39,594 | (965 | ) | 470 | 39,099 | |||||||||||||
| EQUITY |
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| Common stock, no par value |
— | — | — | — | ||||||||||||||
| Additional paid-in capital |
31,645 | — | — | 31,645 | ||||||||||||||
| Retained earnings |
14,582 | — | 5,193 | (c), (d) | 19,775 | |||||||||||||
| Accumulated other comprehensive losses |
(9,208 | ) | — | 250 | (c), (d) | (8,958 | ) | |||||||||||
| Treasury stock, at cost |
(12,473 | ) | — | — | (12,473 | ) | ||||||||||||
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| Mondelēz International Shareholders’ Equity |
24,546 | — | 5,443 | 29,989 | ||||||||||||||
| Noncontrolling interest |
66 | — | — | 66 | ||||||||||||||
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| TOTAL EQUITY |
24,612 | — | 5,443 | 30,055 | ||||||||||||||
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| TOTAL LIABILITIES AND EQUITY |
$ | 64,206 | $ | (965 | ) | $ | 5,913 | $ | 69,154 | |||||||||
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See accompanying notes to the unaudited pro forma consolidated financial statements.
4
NOTES TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
The unaudited pro forma consolidated financial statements as of March 31, 2015 and for the three months ended March 31, 2015 and the fiscal year ended December 31, 2014 include the following pro forma adjustments:
| (a) | Adjustment reflects the removal of incremental costs incurred related to readying our global coffee business for the divestiture. For the three months ended March 31, 2015, the pre-tax charges were $28 million and the related tax benefit was $11 million. For the year ended December 31, 2014, the pre-tax charges were $77 million and the related tax benefit was $31 million. |
| (b) | Adjustment reflects the removal of gains we recognized on currency exchange contracts we secured to lock in an expected euro/U.S. dollar exchange rate related to the expected gross €4 billion receipt of cash proceeds from the divestiture. For the three months ended March 31, 2015, the pre-tax gains were $551 million and the related tax expense was $207 million. For the year ended December 31, 2014, the pre-tax gains were $628 million and the related tax expense was $250 million. |
| (c) | Adjustment reflects the sale of our 50% interest in AGF, a Japanese coffee joint venture, on April 23, 2015. In lieu of contributing our interest in AGF to JDE, we contributed the net cash proceeds from the sale (reflected in adjustment (d)). AGF contributed equity earnings (net of tax) of less than $1 million during the three months ended March 31, 2015 and $8 million during the year ended December 31, 2014, which were removed from the unaudited pro forma consolidated statements of earnings to arrive at pro forma Mondelēz International results (excluding coffee). Additionally, we removed a $32 million deferred tax charge related to the pending AGF sale that we incurred in the three months ended March 31, 2015. Since as of the March 31, 2015 balance sheet date, the sale had not yet closed, we also removed our held for sale investment in AGF from other current assets, goodwill and cumulative translation adjustments from accumulated other comprehensive losses and reflected the $9 million net after-tax loss on the sale as an adjustment to retained earnings. |
| (d) | Adjustment reflects the divestiture of our global coffee businesses and the consideration we received on the closing date, including €3.8 billion ($4.1 billion using a March 31, 2015 currency spot rate) and a 43.5% equity interest in JDE at an estimated value of €3.9 billion ($4.2 billion as of March 31, 2015) based on the estimated fair value of the equity interest as of May 7, 2014 when the divestiture was announced and as adjusted based on our retaining the 50% equity interest in DSF, our Korea-based coffee joint venture. In connection with the closing, we also recorded a receivable for $275 million related to an expected payment from JDE for tax formation costs that we expect to receive a year following the closing. Additionally, we recorded $213 million of receivables and $76 million of cash received related to the reimbursement of costs we expect to incur or have incurred related to separating our coffee businesses, including severance costs. |
We are currently in the process of determining the fair value of our investment in JDE as of the closing date. We expect to have a preliminary valuation completed in the third quarter of 2015. The sale proceeds are also subject to further adjustments, including finalization of working capital, net debt and other sale adjustments. We expect to finalize the sales price and related adjustments by the end of the second quarter of 2016. As a result, the final amount of consideration we receive and the gain we recognize on the divestiture may change materially until we conclude these matters.
We have computed an estimated pre-tax gain of $5.5 billion ($5.2 billion after-tax gain) based on the cash and estimated fair value of the equity interest in JDE we received on the closing date, less our coffee business net assets estimated as of March 31, 2015, $164 million of net cash proceeds related to the sale of our Japanese coffee joint venture (described in (c) above), related accumulated other comprehensive losses as of March 31, 2015 and direct transaction costs incurred on the closing date. As we update the valuation of our investment in JDE and the net assets actually divested as of the closing date, the resulting gain on sale could change materially from the pro forma information presented here as of March 31, 2015.
We also reflected $115 million of estimated one-time after-tax charges related to pension curtailment and other employee costs and incremental transaction-related costs that we expect to incur in connection with the coffee divestiture.
Adjustment also reflects the inclusion of our historical coffee business net earnings within continuing results of operations in the pro forma consolidated statements of earnings as our historical coffee business results reflect an estimate equivalent to our expected share of JDE’s equity earnings based on our 43.5% equity ownership of the combined DEMB and our global coffee net earnings. Note the actual amount of JDE equity earnings we record following the closing date could vary significantly from the estimate based on our historical coffee results. Based on how the divestiture of our coffee business and concurrent investment in JDE was structured, resulting in an exchange of similarly sized coffee interests, we believe this estimate is reasonable and necessary to reflect the impact of the transactions completed on the closing date.
5
Exhibit 99.2
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Contacts:
| For Mondelēz International | For D.E Master Blenders 1753 | |||||
| Media Michael Mitchell +1-847-943-5678 news@mdlz.com |
Investors Dexter Congbalay +1-847-943-5454 ir@mdlz.com |
International Charles Armitstead +44-203-603-5220 enquiries@pendomer.com |
U.S. Tom Johnson +1-212-371-5999 tbj@abmac.com | |||
Mondelēz International and D.E Master Blenders 1753
Complete Coffee Transactions
| • | Transactions Create World’s Leading Pure-Play Coffee Company, JACOBS DOUWE EGBERTS |
| • | Mondelēz International Receives Approximately €3.8 Billion in Cash and a 44% Equity Interest in New Joint Venture |
DEERFIELD, Ill. / AMSTERDAM – July 2, 2015 – Mondelēz International, Inc. (NASDAQ: MDLZ) and D.E Master Blenders 1753 B.V. announced today that they have completed the transactions to combine their respective coffee businesses, including Mondelēz International’s coffee portfolio in France, to create JACOBS DOUWE EGBERTS (JDE), which will be the world’s leading pure-play coffee company with annual revenues of more than €5 billion.
Upon closing, Mondelēz International received cash of approximately €3.8 billion and a 44 percent interest in the new joint venture, subject to standard post-close adjustments. Acorn Holdings B.V. (AHBV), owner of D.E Master Blenders 1753, will have a 56 percent share in JDE. AHBV is owned by an investor group led by JAB Holding Company in partnership with BDT Capital Partners, Quadrant Capital Advisors and Société Familiale d’Investissements.
The new company will be based in the Netherlands and hold market-leading positions in 18 countries globally as well as a strong emerging market presence. JDE will own some of the world’s leading coffee brands, such as Jacobs, Tassimo, Moccona, Senseo, L’OR, Douwe Egberts, Kenco, Pilão and Gevalia.
The cash-and-equity consideration paid to Mondelēz International was reduced proportionally from previous estimates to reflect Mondelēz International retaining its interest in its Korea-based joint venture, Dongsuh Foods Corporation.
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Following the transactions, Mondelēz International becomes an even more focused snacking company, with approximately 85 percent of net revenues derived from biscuits, chocolate, gum and candy. By retaining a significant stake in JDE, however, Mondelēz International will continue to benefit from future growth of the coffee category.
About Mondelēz International
Mondelēz International, Inc. (NASDAQ: MDLZ) is a global snacking powerhouse, with pro forma 2014 revenue of more than $30 billion. Creating delicious moments of joy in 165 countries, Mondelēz International is a world leader in biscuits, chocolate, gum, candy and powdered beverages, with billion-dollar brands such as Oreo, LU and Nabisco biscuits; Cadbury, Cadbury Dairy Milk and Milka chocolate; Trident gum and Tang powdered beverages. Mondelēz International is a proud member of the Standard and Poor’s 500, NASDAQ 100 and Dow Jones Sustainability Index. Visit www.mondelezinternational.com or follow us on Twitter at www.twitter.com/MDLZ.
About JACOBS DOUWE EGBERTS
A global coffee and tea company, serving consumers in more than 80 countries through iconic brands including: Jacobs, Tassimo, Moccona, Senseo, L’OR, Douwe Egberts, Kenco, Pilao and Gevalia. For more information, please visit: www.jacobsdouweegberts.com.
About AHBV and JAB
AHBV is a member of the JAB Holding Company, a privately held affiliated group of entities, operating under the JAB trade name. JAB, is a privately held group focused on long-term investments in companies with premium brands, attractive growth and strong margin dynamics in the consumer goods sector. The group’s portfolio includes a controlling stake in Coty Inc., a global leader in beauty, controlling stakes in luxury goods companies including Jimmy Choo, Bally and Belstaff, a controlling stake in Peet’s Coffee & Tea, a premier specialty coffee and tea company, a controlling stake in Caribou Coffee Company, a specialty retailer of high-quality premium coffee products, a controlling stake in Einstein Noah Restaurant Group, a quick-casual restaurant company, and a controlling stake in D.E Master Blenders 1753 B.V. (“D.E”), the world’s leading pure play coffee and tea company. JAB also owns a minority stake in Reckitt Benckiser PLC, a global leader in health, hygiene and home products. JAB is overseen by its three Senior Partners, Peter Harf, Bart Becht (Chairman) and Olivier Goudet (CEO).
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About BDT Capital Partners
BDT Capital Partners provides family-owned and entrepreneurially led companies with long-term, differentiated capital. Based in Chicago, the firm manages investment funds of more than $8 billion, with an investor base that has the ability to invest significant additional capital. BDT Capital Partners and its affiliated funds are minority investment partners of JAB in JACOBS DOUWE EGBERTS, Peet’s Coffee & Tea, Caribou Coffee Company, and Einstein Noah Restaurant Group. The firm’s affiliate, BDT & Company, is a merchant bank that provides solutions-based advice to family and founder-led businesses and access to an extensive network of world-class closely held businesses.
About Quadrant Capital Advisors, Inc.
Quadrant Capital Advisors is the exclusive investment advisor to the family of Julio Mario Santo Domingo. Similar to Patrinvest and JAB, the family has been invested for generations in the branded consumer goods sector and is today the second largest shareholder of SABMiller plc, the world’s second largest beer company.
About Société Familiale d’Investissements S.A.
Société Familiale d’Investissements S.A. is an affiliate of Patrinvest SCA. Patrinvest SCA holds the interests of some of the Belgian founding families of Anheuser-Busch InBev, the leading global brewer and one of the world’s top five consumer products companies. Their investment philosophy is compatible with JAB’s: the family is focused on the very long term and has a wealth of experience in the branded consumer goods sector.
Forward-Looking Statements
This press release contains a number of forward-looking statements. Words, and variations of words, such as “will,” “expect” and similar expressions are intended to identify these forward-looking statements, including, but not limited to, statements about: the financial and growth prospects for the new company; the future growth of the coffee category; and the benefits of the transactions to Mondelēz International. These forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond Mondelēz International’s control, which could cause Mondelēz International’s actual results to differ materially from those indicated in these forward-looking statements. Such factors include, but are not limited to, risks that growth expectations for the new company and the coffee category will not be realized and the transactions will not yield the anticipated benefits. Please also see Mondelēz International’s risk factors, as they may be amended from time to time, set forth in Mondelēz International’s filings with the SEC, including its most recently filed Annual Report on Form 10-K. Mondelēz International disclaims and does not undertake any obligation to update or revise any forward-looking statement in this press release, except as required by applicable law or regulation.
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