Ralcorp Rejects ConAgra Offer at $94 Per Share

On August 11, 2011, ConAgra Foods, Inc. sent a revised proposal to the Board of Directors of Ralcorp Holdings, Inc. to acquire the company for $94.00 per share in cash. The proposal represents a nearly 10 percent increase from the all-cash $86 per share proposal that ConAgra Foods presented to Ralcorp in May 2011. Ralcorp promptly rejected the revised proposal within 24 hours, and made the below statement in a letter to ConAgra Foods:

"After careful review, our Board of Directors has determined that the separation of Post Foods from Ralcorp will better allow each company to focus on strategies specific to their particular businesses, thereby unlocking additional significant value for our shareholders. We are firmly committed to this plan and therefore, we have unanimously determined that we have nothing further to discuss."

 

ConAgra Foods Chief Executive Officer Gary Rodkin responded: "We are extremely disappointed by Ralcorp's summary rejection of our strong proposal and its repeated refusals to explore this opportunity for its shareholders."

 

ConAgra Foods' $94 per share proposal represented:

 

--a 44 percent premium to Ralcorp's closing price on March 21, 2011, the last business day prior to ConAgra Foods' initial letter in March; and

--a 37 percent premium to Ralcorp's one-month average closing price as of April 28, 2011, the day prior to press speculation on its initial proposal.

 

ConAgra Foods said in a press release that it will continue to consider its options with respect to this potential transaction.