Ospraie Management acquires ConAgra Trade Group
Client(s) Ospraie Management, LLC
Jones Day advised Ospraie Management, LLC in its $2.8 billion acquisition of ConAgra Trade Group, a subsidiary of ConAgra Foods, Inc.
Under the terms of the agreement, ConAgra Foods will sell the operations of ConAgra Trade Group, also known as the company's Trading and Merchandising segment, in exchange for approximately $1.6 billion in cash, subject to working capital fluctuations, and $525 million (face value) of payment-in-kind debt securities of a newly created Gavilon holding company. The weighted average interest rate on the debt securities is 10.82 percent. The final purchase price will be adjusted based on working capital changes subsequent to Feb. 24, 2008. In addition, ConAgra Foods will receive a contingent right to a portion of future earnings during the remainder of calendar 2008 and a warrant exercisable for 8 percent of the equity of the purchaser. This transaction also included a senior secured revolving credit facility for ConAgra Trade Group to finance working capital needs, purchase working capital and for general corporate purposes. ConAgra Trade Group will be renamed Gavilon LLC upon completion of the sale.