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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
June 24, 1997 (June 19, 1997)
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Date of Report (Date of earliest event reported)
CPC International Inc.
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(Exact Name of Registrant as Specified in Charter)
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<S> <C> <C>
Delaware 1-4199 36-2385545
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(State or Other Jurisdiction of (Commission File Number) (IRS Employer Identification Number)
Incorporation)
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International Plaza, P.O. Box 8000
Englewood Cliffs, New Jersey 07632-9976
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(Address of Principal Executive Offices) (Zip Code)
(201) 894-4000
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Registrant's telephone number, including area code
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Item 5. Other Events.
Reference is made to the press release issued by Registrant on June 19,
1997, regarding charges taken by the Company related to the cost of spinning off
its corn refining business and the restructuring of its packaged food
operations, which is filed herewith as Exhibit 99.1 and is incorporated by
such reference.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
Exhibit 99.1 Registrant's Press Release issued on June 19, 1997.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: June 24, 1997 CPC INTERNATIONAL INC.
By: /s/ HANES A. HELLER
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Hanes A. Heller
Vice President and
General Counsel
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EXHIBIT INDEX
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EXHIBIT DESCRIPTION
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99.1 Registrant's Press Release issued on June 19, 1997.
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EXHIBIT 99.1
CONTACT: Gale L. Griffin 201/894-2407
Vice President, Corporate Communications
CPC INT'L TO TAKE 2ND-QTR. CHARGES FOR SPIN-OFF COSTS AND RESTRUCTURING
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ENGLEWOOD CLIFFS, NJ, June 19, 1997 -- CPC International Inc. today
announced that it will take a pre-tax $86 million charge in the second quarter
($65 million after tax or $.45 per common share) related to the cost of spinning
off its corn refining operations. Also, in the second quarter, the company will
take a pre-tax charge of $242 million ($155 million after tax or $1.08 per
common share) related to the restructuring of its packaged foods operations. The
company said that the planned restructuring activities are expected to result in
savings that will reach at least $60 million in 1998 and more than $90 million
in 1999 and thereafter, adding substantially to operating income.
The cash portions of the spin-off and restructuring charges after taxes
will be 75% and 40%, respectively.
Spin-off Charge for Separation of Businesses into Independent Companies
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As previously announced, CPC expects to spin off its worldwide corn
refining operations by the end of the year in order to give both companies the
focus, flexibility, and resources needed for faster growth of sales, volumes,
and profits. The cost of separating the two businesses includes direct costs
such as fees in the legal, tax, and investment banking areas, as well as the
costs for the separation of facilities that were used to produce both packaged
foods and corn-derived products. An important part of the spin-off charge is
related to restructuring as well as staffing reductions in the corn refining
business, mainly in its international operations spanning 18 countries.
Resulting savings will benefit the business from its inception as a separate
company.
Restructuring Charge for Streamlining Packaged Foods Operations Worldwide
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Approximately 50% of the restructuring charge relates to the company's
worldwide consumer foods business, 35% is for the baking business, and 15% for
reductions in corporate overhead.
The majority of the activities to be undertaken in the consumer foods
business pertain to European and North American operations and include the sale
of some non-core businesses, potential plant closings, reorganization of
administrative functions, and the previously-announced transfer of Mueller's
pasta production to an outside manufacturer.
The baking business restructuring includes continued consolidation and
reconfiguration of manufacturing and distribution systems and processes to
improve overall business efficiency and effectiveness.
C.R. Shoemate, chairman and chief executive officer of CPC, commented,
"The announcement of this restructuring further indicates our commitment to
achieve rapid growth in our global packaged foods business. Our packaged foods
operations continue in very good health and will be capable of still more
aggressive growth as a result of the moves we're making now. Our core
businesses, chiefly under the Knorr and Hellmann's brands, are well established
in all the developed countries of North America and
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Europe and well positioned in the rapidly growing economies of Latin America
and Asia. We have an increasingly efficient network of plants and
distribution systems throughout the world. And we have skilled and
knowledgeable people in place to ensure that our global core businesses
increase their pace of rapid and profitable growth. In short, CPC has the
means, the opportunities, and the determination to deliver consistently
superior performance and return to its shareholders."
ABOUT CPC INTERNATIONAL: CPC International Inc. is among the largest U.S. food
companies and ranks as one of the 100 largest industrial companies in the U.S.,
with sales of $9.8 billion in 1996. Best known among CPC's U.S. products are:
Hellmann's and Best Foods mayonnaise and dressings; Mazola corn oil and
margarine; Skippy peanut butter; Knorr soups, sauces, and bouillons; Entenmann's
sweet baked products; Thomas' English muffins; Arnold, Brownberry, Freihofer's,
and Oroweat breads; Boboli pizza crusts; Mueller's pasta; and Karo syrup. CPC's
global Knorr brand comprises on of the world's most extensive lines of products.
CPC is one of the nation's most international food companies, with operations in
62 countries. CPC is also one of the largest corn refiners, with operations in
North America and Latin America. CPC has announced a plan to spin off its Corn
Refining Business as an independent company to CPC shareholders. For more
information about CPC, visit the company's Web site on the Internet at:
http://www.cpcinternational.com.
