Legal DealFolio - Premier Foods/The Gores Group

Slaughter and May is advising Premier Foods plc (Premier Foods) on a conditional agreement with The Gores Group LLC, a US global investment firm headed by Alec Gores (The Gores Group), to operate its bread business (excluding the Charnwood Foods facility in Leicester and a flour mill in Andover) as a stand-alone joint venture which will trade under the name of Hovis Limited. Under the agreement, which was announced on 27 January 2014, The Gores Group will pay GBP30 million for a 51% controlling stake in the joint venture, of which GBP15 million is deferred and depends on future business performance. The transaction values the bread business at an enterprise value of GBP87.5 million, including GBP28.7 million of working capital that will be retained by Premier Foods. Premier Foods and The Gores Group have further agreed to invest a combined GBP45 million in the business in proportion to their holdings as loan notes, of which GBP32 million will be provided when the joint venture completes. This investment, together with external financing and cash flow from the business, will be used to fund the joint venture's plan to invest approximately GBP200 million in the business over the next five years to improve its operational infrastructure and reinvigorate the Hovis brand. The proposed transaction includes the transfer to the joint venture of the production, distribution, sales and marketing of Hovis, Mothers Pride, Ormo, Granary and Nimble brands, private label business, business-to- business sales and the flour milling business. Premier Foods will retain the McDougall's brand for use in retail and certain food-service sales of flour and bread mixes and will enter into a licensing arrangement with the joint venture for the use of the Hovis brand for similar retail and business-to-business sales of flour and bread mixes. The transaction is subject to approval by Premier Foods' shareholders and obtaining relevant consent/waivers from Premier Foods' lenders and pension scheme trustees, as well as competition approval from the European Commission. The transaction is expected to complete during the second quarter of 2014. Corporate: Michael Corbett (partner), Ross Davies (associate), Filippo de Falco (associate), Paul Mudie (associate), Christopher Cowley (associate); Financing: Robert Byk (partner), Susan Hughes (associate); Real Estate: John Nevin (partner), Roopa Modi (associate), Mark Gulliford (associate), Jane Hilton (associate); Tax: Mike Lane (partner), Shofiq Miah (associate); IP: Cathy Connolly (partner), Alice McDonald (associate), Laura Houston (associate); Pensions and Employment: Roland Doughty (partner), Harriett Clover (associate); Competition: Lisa Wright (partner), Anthony Hartley (associate).

Deal Date:	27-01-2014	Practice Area:	Corporate and M&A
Deal Title:	Premier Foods/The Gores Group - Hovis Limited Joint Venture	Industry:	Food Producers
Description:	Slaughter and May is advising Premier Foods plc (Premier Foods) on a conditional agreement with The Gores Group LLC, a US global investment firm headed by Alec Gores (The Gores Group), to operate its bread business (excluding the Charnwood Foods facility in Leicester and a flour mill in Andover) as a stand-alone joint venture which will trade under the name of Hovis Limited. Under the agreement, which was announced on 27 January 2014, The Gores Group will pay GBP30 million for a 51% controlling stake in the joint venture, of which GBP15 million is deferred and depends on future business performance. The transaction values the bread business at an enterprise value of GBP87.5 million, including GBP28.7 million of working capital that will be retained by Premier Foods. Premier Foods and The Gores Group have further agreed to invest a combined GBP45 million in the business in proportion to their holdings as loan notes, of which GBP32 million will be provided when the joint venture completes. This investment, together with external financing and cash flow from the business, will be used to fund the joint venture's plan to invest approximately GBP200 million in the business over the next five years to improve its operational infrastructure and reinvigorate the Hovis brand. The proposed transaction includes the transfer to the joint venture of the production, distribution, sales and marketing of Hovis, Mothers Pride, Ormo, Granary and Nimble brands, private label business, business-to- business sales and the flour milling business. Premier Foods will retain the McDougall's brand for use in retail and certain food-service sales of flour and bread mixes and will enter into a licensing arrangement with the joint venture for the use of the Hovis brand for similar retail and business-to-business sales of flour and bread mixes. The transaction is subject to approval by Premier Foods' shareholders and obtaining relevant consent/waivers from Premier Foods' lenders and pension scheme trustees, as well as competition approval from the European Commission. The transaction is expected to complete during the second quarter of 2014. Corporate: Michael Corbett (partner), Ross Davies (associate), Filippo de Falco (associate), Paul Mudie (associate), Christopher Cowley (associate); Financing: Robert Byk (partner), Susan Hughes (associate); Real Estate: John Nevin (partner), Roopa Modi (associate), Mark Gulliford (associate), Jane Hilton (associate); Tax: Mike Lane (partner), Shofiq Miah (associate); IP: Cathy Connolly (partner), Alice McDonald (associate), Laura Houston (associate); Pensions and Employment: Roland Doughty (partner), Harriett Clover (associate); Competition: Lisa Wright (partner), Anthony Hartley (associate).
Financial Center:	London	Value:	100.01-500.00
Advised Party:	Joint Venture Party	Law Firm	Slaughter and May
JV Party Jurisdiction	United States,United Kingdom	JV Party Jurisdiction	United Kingdom
Classification:	Joint Ventures Continuing Business Partnership	Lawyer	Michael Corbett

Practice Areas -

Corporate and M&A Law Firms and Lawyers

Practice Areas - Corporate and M&A Law Firms and Lawyers