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SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
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FLOWERS INDUSTRIES, INC.
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N/A
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November 3, 2000
Dear Flowers Shareholder:
Flowers Industries announced on October 26 that it reached an agreement to sell
through an integrated series of transactions, its controlling stake in Keebler
Foods to the Kellogg Company for $42.00 per share. The company also announced
that simultaneously with the sale of Keebler, it would spin off to shareholders
a new publicly held company called Flowers Foods, comprised of Flowers Bakeries
and Mrs. Smith's Bakeries.
To put the Keebler sale price into perspective, it's important to remember that
Flowers Industries and its partner acquired Keebler in 1996 for a total
enterprise value of $472 million. We are now selling Keebler for a total
enterprise value of $4.4 billion. Flowers owns approximately 55% of Keebler.
After subtracting Keebler's debt, our proceeds from the transaction will be $1.9
billion. After deducting Flowers' debt for the original investment, its
interest, and transaction costs, we will deliver a total of approximately $1.25
billion to shareholders.
These transactions will allow Flowers Industries' shareholders to receive--in a
tax-advantaged way--approximately $12.50 in cash per share for our investment in
Keebler, after deducting certain liabilities at Flowers. Shareholders also will
receive shares in Flowers Foods, which will be a fine company with good cash
flow and growth potential within the packaged baked foods category. Flowers
Foods is anticipated to trade on the New York Stock Exchange under the original
symbol FLO. The company will include the bakery businesses and approximately
$250 million in debt. It will be headquartered in Thomasville, Georgia, and will
be led by the Flowers Industries management team.
Now that the agreement with Kellogg has been reached, the transaction must be
approved by regulatory agencies as well as by Flowers shareholders. We
anticipate the sale of Keebler and the spin-off of Flowers Foods to occur in the
first quarter of 2001.
We know that you may have many questions about this transaction, especially its
tax implications. For that reason, we have prepared a "question and answer"
document with all the information that is currently available. This document
immediately follows the financial statements in the enclosed third quarter
earnings statement.
As managers of your company, we remain committed to our mission of delivering
value to you, our shareholder. We believe our investment in Keebler has been
extraordinarily successful and that now was the right time to capture that
value. We also believe that shareholders will receive value in Flowers Foods,
which will continue to grow in the future.
We appreciate your investment in Flowers.
Kind Regards,
/s/ Amos R. McMullian /s/ Robert P. Crozer
AMOS R. MCMULLIAN ROBERT P. CROZER
Chairman of the Board and Vice Chairman of the Board,
Chief Executive Officer, Flowers Industries
Flowers Industries Chairman of the Board, Keebler Foods
