Summary
This Form 8-K filing by Mondelez International, Inc. (MDLZ) on October 5, 2012, formally announces the completion of the spin-off of its North American grocery business, Kraft Foods Group, Inc. (KFG), effective October 1, 2012. This significant corporate event resulted in Mondelez shareholders receiving one share of KFG for every three shares of Mondelez International held. The distribution was structured to be tax-free for U.S. federal income tax purposes, with an approximate market value of $26.1 billion based on KFG's when-issued closing price. For investors, this marks the creation of two distinct, publicly traded entities. Mondelez International will now focus on its global snacks, confectionery, and beverage businesses, shedding its North American grocery operations. Consequently, KFG will no longer be consolidated within Mondelez's financial results, providing a clearer financial picture for each company moving forward. Investors should note the unaudited pro forma financial information included as an exhibit, which provides insight into the financial implications of this separation.
Key Highlights
- 1Completion of the spin-off of the North American grocery business (Kraft Foods Group, Inc. - KFG) on October 1, 2012.
- 2Mondelez International shareholders received one share of KFG for every three shares of Mondelez International held as of the record date (September 19, 2012).
- 3The distribution of KFG shares had an approximate market value of $26.1 billion, based on KFG's when-issued closing price of $44.10 per share.
- 4The spin-off was structured to be tax-free to Mondelez shareholders for U.S. federal income tax purposes.
- 5Mondelez International no longer beneficially owns any shares of KFG.
- 6KFG will no longer be consolidated within Mondelez International's financial results, allowing for distinct reporting.
- 7Unaudited pro forma consolidated financial information reflecting the spin-off is attached as an exhibit.