Pilgrim's Pride Proposes to Acquire Hillshire Brands for $45.00 Per Share in Cash - Seite 2

Lazard is acting as financial advisor to Pilgrim's and Cravath, Swaine & Moore LLP is acting as its legal counsel.

Below is the text of the letter that was sent to Sean Connolly, Hillshire's President and Chief Executive Officer, today:

  May 27, 2014

Mr. Sean Connolly
President and Chief Executive Officer
The Hillshire Brands Company
400 South Jefferson Street
Chicago, IL 60607

Dear Sean,

On behalf of Pilgrim's Pride Corporation ("PPC"), we are writing to convey our proposal to acquire The Hillshire Brands Company ("Hillshire" or the "Company"). As expressed during our meeting in Chicago on February 20, 2014 we have the utmost respect for Hillshire, its leadership and its employees, and, as you are well aware, it has long been our desire to acquire the Company. We also admire the role that Hillshire has played in the communities it serves, and we would maintain this tradition, making Chicago a major center of North American operations.

Based on our extensive review of the Company, we are prepared to offer $45 per share in cash for all of the outstanding shares of Hillshire common stock. Our proposal values Hillshire at 12.5x its trailing twelve-month adjusted EBITDA as of March 29, 2014, including the $163 million termination fee payable to Pinnacle Foods Inc. ("Pinnacle"). We would assume such fee upon closing.

Section 5.4 of your agreement with Pinnacle explicitly contemplates the Hillshire Board, in the exercise of its fiduciary duties, entering into negotiations and providing diligence if it receives a Superior Proposal, which is defined as a Takeover Proposal that is more favorable to Hillshire's stockholders from a financial point of view than the Pinnacle transaction. A sale of the Company at the price indicated above offers superior value and far greater certainty to Hillshire shareholders than the contemplated Pinnacle transaction. 

We are coming forward now because the opportunity for your shareholders to obtain the compelling value represented by our proposal will no longer exist if the proposed acquisition of Pinnacle is consummated. Our offer is therefore conditioned on the termination of this transaction (and our proposed purchase price is not subject to reduction for any related termination fees). In light of the materiality of the proposed transaction and disclosure rules, we plan to announce our proposal publicly.