8-K

 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): July 19, 2006

The J.M. Smucker Company
__________________________________________
(Exact name of registrant as specified in its charter)

Ohio	1-5111	34-0538550
_____________________ (State or other jurisdiction	_____________ (Commission	______________ (I.R.S. Employer
of incorporation)	File Number)	Identification No.)
One Strawberry Lane, Orrville, Ohio		44667-0280
_________________________________ (Address of principal executive offices)		___________ (Zip Code)

Registrant’s telephone number, including area code: 330-682-3000

Not Applicable
______________________________________________
Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[  ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry into a Material Definitive Agreement.

On July 19, 2006, Smucker Foods of Canada Co. (the "Seller"), a subsidiary of The J.M. Smucker Company (the "Registrant"), entered into an Asset Purchase Agreement (the "Agreement") with Horizon Milling G.P. (the "Buyer"). Pursuant to the Agreement, the Seller has agreed to sell, and the Buyer has agreed to purchase, certain assets relating to the Registrant's Canadian grain-based foodservice and industrial businesses.

The purchase price, subject to certain post-closing adjustments provided for in the Agreement, is Eighty One Million Canadian Dollars ($81,000,000 CDN), plus an amount determined by reference to the estimated closing inventory less certain amounts allocated for capital improvements and certain accruals arising in the ordinary course of business and outstanding on the closing date. The Agreement provides for the adjustment of the purchase price based on the final closing inventory amount following the closing of the transaction.

The Agreement contains customary representation s and warranties, covenants and indemnification provisions. The Agreement also provides for certain other arrangements between the parties and/or their designees that will be effective as of the closing, including: a license agreement relating to the formulas used by Seller in the business to be sold; a supply agreement, whereby the Buyer will supply to Seller all of Seller’s requirements of Canadian grain-based retail products; an operating agreement relating to Seller’s cake mix plant in Montreal, Canada; and a license agreement relating to certain trademarks used in the business to be sold.

The Agreement contains certain conditions to closing, which include, without limitation, the receipt of certain consents and approvals, including approval under the Competition Act (Canada) as described in the Agreement. If any of the conditions to closing are not satisfied by November 15, 2006, or if satisfaction of any of the closing conditions by that date becomes impossible, Seller or Buyer may have the right to terminate the Agreement. The Registrant cannot predict with certainty whether or when the closing conditions will be satisfied or whether or when the transactions contemplated by the Agreement will be consummated.

In addition to the relationships arising out of the Agreement and in the ordinary course of business, Cargill, an affiliate of Buyer, supplies certain raw materials to the Registrant and/or its affiliates and both parties provide certain processing services to each other.

Item 7.01 Regulation FD Disclosure.

On July 20, 2006, the Registrant issued a press release announcing its entry into the Agreement. A copy of the press release is being furnished as Exhibit 99.1 to this current report.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit 99.1 Press Release of the Registrant relating to the Entry into the Agreement

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.

	The J.M. Smucker Company
July 25, 2006	By:	/s/ Mark R. Belgya
		Name: Mark R. Belgya
		Title: Vice President, Chief Financial Officer and Treasurer

Exhibit Index

Exhibit No.	Description
99.1	Press Release of the Registrant relating to the Entry into the Agreement.

EX-99.1

Exhibit 99.1

The J. M. Smucker Company Announces a Definitive Agreement to Sell Canadian Grain-Based Foodservice
and Industrial Businesses to the Owners of Horizon Milling, LLC

ORRVILLE, Ohio and MINNEAPOLIS, Minnesota, July 20, 2006—The J. M. Smucker Company (NYSE: SJM) today announced having reached a definitive agreement to sell the Canadian grain-based foodservice and industrial businesses owned by Smucker Foods of Canada Co., a wholly owned subsidiary of The J. M. Smucker Company, to Horizon Milling G.P., to be owned by Cargill and CHS Inc., parent companies of Horizon Milling, LLC, a leading U.S. flour miller. Cargill is an international provider of food, agricultural and risk management products and services, and CHS Inc. (NASDAQ: CHSCP) is a diversified company providing essential food, grain and energy resources to businesses and consumers. The transaction is expected to close by the end of September, subject to regulatory approval.

According to Guy Shoemaker, President, Horizon Milling, the agreement will ensure that flour and bakery mix customers throughout Canada will continue to be provided a reliable, cost-effective and high-quality supply of products.

“We are excited about this opportunity to participate in the Canadian baking industry and to create more opportunities for its bakery customers,” said Shoemaker. “Our commitment is to build on the significant contributions of the Smucker Company. Additionally, this acquisition complements our broader bakery strategy to provide distinctive customer solutions in supply-chain optimization, product formulation, and risk management.”

“The Smucker Company is pleased to enter into an arrangement with a company that has built deep customer relationships and is committed to the long term success of our retail baking business in Canada,” said Mark Smucker, Vice President, Managing Director, Canada, The J. M. Smucker Company.

The Smucker Company’s strategy is to own and market leading North American food brands sold in the center of the store. The Canadian grain-based foodservice and industrial businesses, acquired as part of the International Multifoods acquisition, are not aligned with this strategy and the decision was made to divest these non-strategic businesses. The Smucker Company will continue to market and distribute Robin Hood® branded products through Canadian retail channels along with its Bick’s®, Smucker’s®, Jif®, and Crisco® brands. Through a co-packing agreement, Horizon Milling will provide branded retail baking products, including Robin Hood flour, to the Smucker Company.

The businesses being divested primarily include three flour milling operations in Montreal, Quebec, Port Colborne, Ontario, and Saskatoon, Saskatchewan, and two dry baking mixing facilities in Montreal and Burlington, Ontario. The Smucker Canadian corporate operations in Markham and Rexdale, Ontario, will also be impacted although the extent of these changes is not yet known.

According to Smucker, the sale is expected to generate net cash proceeds of approximately $78 million, and result in a pretax loss of approximately $10 — 15 million, or $0.12 — $0.18 per diluted share. The divested businesses contributed approximately $170 million in sales and $4 million, or $0.07 per diluted share, in net earnings to Smucker’s fiscal 2006 results. The Smucker Company estimates that the net impact of the sale will reduce earnings per share from continuing operations by approximately $0.02 per diluted share for fiscal 2007. Smucker also estimates that the sale of this lower margin business will improve overall profit margins for the Company. Following the transaction, the Canadian business will represent approximately 10 percent of total Smucker sales.

About The J. M. Smucker Company

The J. M. Smucker Company (www.smuckers.com) was founded in 1897 when the Company’s namesake and founder sold his first product — apple butter — from the back of a horse-drawn wagon. Today, over a century later, the Company is the market leader in fruit spreads, peanut butter, shortening and oils, ice cream toppings, and health and natural foods beverages in North America under such icon brands as Smucker’sÒ, JifÒ and CriscoÒ. The family of brands also includes PillsburyÒ baking mixes and ready-to-spread frostings; Hungry JackÒ pancake mixes, syrups and potato side dishes; and Martha WhiteÒ baking mixes and ingredients in the U.S., along with Robin HoodÒ flour and baking mixes and Bick’sÒ pickles and condiments in Canada. For over 109 years, The J. M. Smucker Company has been headquartered in Orrville, Ohio, and has been family run for four generations. Since the 1998 inception of FORTUNE Magazine’s annual survey of the 100 Best Companies to Work For, The J. M. Smucker Company has consistently been recognized as one of the top 25 companies to work for in the United States. The J. M. Smucker Company has approximately 3,500 employees worldwide and distributes products in more than 45 countries.

About Horizon Milling, LLC

A leading U.S. flour miller, Horizon Milling, LLC is a joint venture between Cargill and CHS Inc. Horizon Milling combines the expertise of a global food ingredients manufacturer with the supply assurance capabilities of a national, farmer-owned cooperative to provide customers with innovative, flour-related product and service solutions. For more information, visit http://www.horizonmilling.com.

About Cargill

Cargill is an international provider of food, agricultural and risk management products and services. With 142,000 employees in 61 countries, the company is committed to using its knowledge and experience to collaborate with customers to help them succeed. For more information, visit http://www.cargill.com.

About CHS

CHS is a diversified Fortune 500 company providing essential food, grain and energy resources to businesses and customers. CHS is listed on the NASDAQ at CHSCP. For more information, visit http://www.chsinc.com.

The J. M. Smucker Company Forward-Looking Language

This press release contains forward-looking statements, including statements regarding estimates of future earnings and cash flows that are subject to risks and uncertainties that could cause actual results to differ materially. Uncertainties that could affect actual results include, but are not limited to, the timing of the close of the proposed transaction, and other factors affecting share prices and capital markets generally. Other risks and uncertainties that may materially affect the Company are detailed from time to time in the respective reports filed by the Company with the Securities and Exchange Commission, including Forms 10-Q, 10-K, and 8-K.

Contacts:

The J. M. Smucker Company
(330) 682-3000

Investors:
Mark R. Belgya
Vice President, Chief Financial Officer and Treasurer

George G. Sent, Jr.
Director, Corporate Finance and Investor Relations

Media:
Maribeth Badertscher
Director, Corporate Communications

Lori Fligge
Cargill (U.S.)
Director, Media Relations
(952) 742-2275

Rob Meijer
Cargill (Canada)
Director, Public Affairs
(204) 947-6370