Altria to give Kraft spinoff plans in January
October 26, 2006
by Eric Schroeder
NEW YORK — The board of directors of Altria Group, Inc. intends to finalize its decision, including the precise timing, on the distribution of all Kraft Foods Inc. shares owned by Altria to Altria shareholders when it holds a regularly scheduled meeting on Jan. 31, 2007, Altria said. On Sept. 30, Altria owned about 88.6% of the outstanding shares of Kraft Foods.
"Today’s announcement brings us a step closer to a fully independent Kraft," said Louis C. Camilleri, chairman and chief executive officer of Altria. "It recognizes our conviction that, having publicly discussed the restructuring of the company two years ago, this is the right time to move forward."
The timetable coincides with Irene Rosenfeld, c.e.o. of Kraft, planning to give Kraft’s new profitable growth plan, Mr. Camilleri said in an earnings conference call on Oct. 25. Recent court cases involving Philip Morris International, Inc., of which Altria owns 100% of the outstanding common shares, played a factor in Altria’s timetable of spinning off Kraft.
"I think today’s announcement clearly shows to the world that the board is comfortable with the litigation environment and is therefore prepared to move forward," Mr. Camilleri said.
Philip Morris Cos. acquired Kraft for $12.9 billion in1988. Shareholders of Philip Morris Cos. accepted a proposal in 2002 to change the company’s name to Altria Group. Shares of Kraft Foods Inc. were trading a $34.83 per share over the lunch hour on Oct. 25 after opening the day at $35.29 per share.