NORTHFIELD, Ill., May 18, 2012 /PRNewswire/ -- Kraft Foods Inc.
(NYSE:KFT) announced today that the U.S. Internal Revenue Service
(IRS) has provided a favorable private letter ruling confirming the
tax-free status of the planned spin-off of the company's North
American grocery business and certain related internal
reorganization transactions. Following the transaction, the
North American grocery business will be an independent, public
company operating as Kraft Foods Group, Inc.
(Logo: http://photos.prnewswire.com/prnh/20090420/KRAFTLOGO)
"This favorable tax ruling from the IRS is a significant
milestone in the spin-off process," said Dave Brearton, Executive Vice President and
Chief Financial Officer. "We remain firmly on-track to launch
two industry-leading companies before the end of 2012."
Based on certain facts, assumptions, representations and
undertakings set forth in the ruling, for U.S. federal income tax
purposes, the distribution of Kraft Foods Group, Inc. common stock
generally will not be taxable to Kraft Foods Inc. or to U.S.
holders of Kraft Foods Inc. common stock, except in respect to cash
received in lieu of fractional share interests, which generally
will be taxable to the holders as capital gain.
The spin-off is subject to a number of conditions, including the
continued validity of the private letter ruling from the IRS, the
effectiveness of Kraft Foods Group's Registration Statement on Form
10 that was filed with the U.S. Securities and Exchange Commission,
as amended, the execution of inter-company agreements related to
the spin-off and final approval from the Kraft Foods Inc. Board of
Directors.
Further information on the spin-off of the North American
grocery business is available in Kraft Foods Group's Registration
Statement on Form 10, as amended on May 14,
2012, at http://www.sec.gov or on Kraft Foods' website at
http://phx.corporate-ir.net/phoenix.zhtml?c=129070&p=irol-sec.
About Kraft Foods
Kraft Foods Inc. (NYSE: KFT) is a global snacks powerhouse
with an unrivaled portfolio of brands people love. Proudly
marketing delicious biscuits, confectionery, beverages, cheese,
grocery products and convenient meals in approximately 170
countries, Kraft Foods had 2011 revenue of $54.4 billion. Twelve of the company's iconic
brands – Cadbury, Jacobs, Kraft, LU,
Maxwell House, Milka, Nabisco, Oreo,
Oscar Mayer, Philadelphia, Tang and
Trident – generate revenue of more than $1 billion annually. On Aug. 4, 2011, Kraft Foods announced plans to
divide and create two independent public companies: a high-growth
global snacks business and a high-margin North American grocery
business. The transaction is expected to be completed before the
end of 2012. A leader in innovation, marketing, health &
wellness and sustainability, Kraft Foods is a member of the Dow
Jones Industrial Average, Standard & Poor's 500, Dow Jones
Sustainability Index and Ethibel Sustainability Index. Visit
kraftfoodscompany.com and facebook.com/kraftfoodscorporate.
Forward-Looking Statements
This press release contains a number of forward-looking
statements. Words, and variations of words such as "expect,"
"will" and similar expressions are intended to identify our
forward-looking statements, including but not limited to, our
intent to create two industry-leading companies by the end of the
year; our progress on the spin-off; and the tax-free status of the
spin-off and related transactions. These forward-looking statements
are subject to a number of risks and uncertainties, many of which
are beyond our control, which could cause our actual results to
differ materially from those indicated in our forward-looking
statements. Such factors include, but are not limited to, our
failure to successfully separate the company and continued validity
of the tax ruling. Please also see our risk factors, as they
may be amended from time to time, set forth in our filings with the
SEC, including our most recently filed Annual Report on Form 10-K
and subsequent reports on Forms 10-Q and 8-K. Kraft Foods
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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SOURCE Kraft Foods Inc.