Sara Lee to Sell Fresh Bakery Business in Spain, Portugal to Grupo Bimbo

Sara Lee announced an agreement to sell its fresh bakery businesses in Spain and Portugal to Mexico's Grupo Bimbo for an estimated $154 million at current exchange for in cash.

The agreement includes all Sara Lee fresh bakery brands in Spain and Portugal as well as seven manufacturing facilities. The transaction, which is subject to customary closing conditions and regulatory clearance, is expected to close within 60 days.

Sara Lee holds the number 1 position among branded bakery manufacturers in Spain, while leasing brands such as Bimbo, Martinez, Ortiz, and Silueta.

In FY11, the business generated net sales of $408 million. It employs approximately 2,000 people. Sara Lee's remaining international bakery businesses headquartered in France and Australia remain the subject of a divestiture process and a strategic review, respectively.

These two businesses generated aggregate revenue of approximately $318M in FY11, and sell products primarily in France, Sweden, Italy, Australia and New Zealand.

Sara Lee (NYSE:SLE) has a potential upside of 18.4% based on a current price of $16.71 and an average consensus analyst price target of $19.78.

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