Grupo Bimbo in $2.5 Billion Acquisition of Weston Foods

January 29, 2009

Cleary Gottlieb represented Grupo Bimbo, S.A.B. de C.V. (Grupo Bimbo) in its acquisition of Weston Foods, Inc., the U.S. bakery division of George Weston Limited, for U.S.$2.38 billion and its acquisition of related financial assets for U.S.$125 million. The transaction closed on January 21, 2009.

Seven banks financed the transaction through a U.S.$1.9 billion dual currency term facility with a three-year tranche, a five-year tranche and a U.S.$900 million dual currency one-year bridge facility that is expected to be taken out in the local bond market. A substantial portion of the commitments were funded in Mexican Pesos, requiring Grupo Bimbo to engage in foreign exchange transactions in between funding and payment to George Weston Limited on the day of closing. This is the largest cross-border acquisition financing in recent months in Latin America.

Grupo Bimbo, which is among the world’s largest baking companies in terms of production and sales volume, has more than 80 plants and 800 distribution centers located in 18 countries throughout the Americas, Europe and Asia. Grupo Bimbo produces over 5,000 products and its direct distribution networks comprise more than 36,500 routes and 96,000 employees.

As a result of this transaction Bimbo Bakeries USA (BBU), Grupo Bimbo’s consolidated U.S. operation, becomes one of the largest baked-goods companies in the country, with a leading position in bread, buns, sweet baked goods and cakes. BBU’s brand portfolio now includes Arnold, Bimbo, Boboli, Brownberry, Entenmann’s, Francisco, Freihoffer’s, Marinella, Mrs Baird’s, Oroweat, Stroehmann, Thomas’ and Tia Rosa.