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INVESTMENTS IN AND RECEIVABLES FROM AFFILIATES

3 Months Ended

Jan. 29, 2012

INVESTMENTS IN AND RECEIVABLES FROM AFFILIATES

INVESTMENTS IN AND RECEIVABLES FROM AFFILIATES

NOTE D INVESTMENTS IN AND RECEIVABLES FROM AFFILIATES

The Company accounts for its majority-owned operations under the consolidation method. Investments in which the Company owns a minority interest, and for which there are no other indicators of control, are accounted for under the equity or cost method. These investments, along with any related receivables from affiliates, are included in the Consolidated Statements of Financial Position as investments in and receivables from affiliates.

Investments in and receivables from affiliates consists of the following:

(in thousands)		Segment		% Owned		January 29, 2012			October 30, 2011
MegaMex Foods, LLC		Grocery Products		50%		$	204,791		$	205,523
Purefoods-Hormel Company		All Other		40%		64,316			65,140
San Miguel Purefoods (Vietnam) Co. Ltd.		All Other		49%		15,975			17,442
Other		Various		Various		7,819			7,593
Total						$	292,901		$	295,698

Equity in earnings of affiliates consists of the following:

				Three Months Ended
(in thousands)		Segment		January 29, 2012			January 30, 2011
MegaMex Foods, LLC		Grocery Products		$	8,624		$	4,926
Purefoods-Hormel Company		All Other		3,487			2,025
San Miguel Purefoods (Vietnam) Co. Ltd.		All Other		(1,467		)	(211		)
Other		Various		357			165
Total				$	11,001		$	6,905

MegaMex Foods, LLC

On October 26, 2009, the Company completed the formation of MegaMex Foods, LLC (MegaMex), a 50/50 joint venture formed by the Company and Herdez Del Fuerte, S.A. de C.V. to market Mexican foods in the United States. On October 6, 2010, MegaMex acquired 100 percent of the stock of Don Miguel Foods Corp. (Don Miguel). Don Miguel is a leading provider of branded frozen and fresh authentic Mexican appetizers, snacks, and hand held items. On August 22, 2011, MegaMex acquired 100 percent of Fresherized Foods, which produces Wholly Guacamole®, Wholly Salsa®, and Wholly Queso® products.

The Company recognized a basis difference of $21.3 million associated with the formation of MegaMex, which is being amortized through equity in earnings of affiliates.

The entire disclosure for equity investment, or group of investments, for which combined disclosure is appropriate, including: (a) the name of each investee and percentage of ownership of common stock, (b) accounting policies for investments in common stock, (c) difference between the amount at which the investment is carried and the amount of underlying equity in net assets and the accounting treatment of the difference, (d) the total fair value of each identified investment for which a market value is available, (e) summarized information as to assets, liabilities, and results of operations of the investees (for investments in unconsolidated subsidiaries, common stock of joint ventures, or other investments using the equity method), and (f) material effects of possible conversions, exercises, or contingent issuances of the investee. Other disclosures include (a) the names of any investee in which the investor owns 20 percent or more of the voting stock and investment is not accounted for using the equity method, and the reasons why not, and (b) the names of any investee in which the investor owns less than 20 percent of the voting stock and the investment is accounted for using the equity method, and the reasons why it is.

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