ACQUISITIONS

In January 2013, we acquired Ralcorp Holdings, Inc. ("Ralcorp"). The total amount of consideration paid in connection with the acquisition was approximately $4.75 billion, net of cash acquired, plus assumed liabilities. We funded the merger consideration with existing cash on hand, borrowings under a new $1.5 billion senior unsecured Term Loan Facility with Bank of America, N.A., as administrative agent and a lender, JP Morgan Chase Bank, N.A. as syndication agent and a lender, and the other financial institutions party thereto (the "Term Loan Facility"), and net proceeds from the issuance of new senior notes and common stock. The Ralcorp business is reflected in two reporting segments: the Ralcorp Food Group segment and the Ralcorp Frozen Bakery Products segment.

The following table summarizes the preliminary estimated fair values of the assets acquired and liabilities assumed at the acquisition date. The fair values of the assets and liabilities related to Ralcorp are subject to refinement as we complete our analyses relative to the fair values at the date of acquisition. Changes that have occurred since initial allocation have not been retrospectively applied, as the impact on reported results would not have been material.



	January 29, 2013
Assets acquired:
Cash and cash equivalents	$	320.7
Other current assets	912.8
Property, plant and equipment	1,006.8
Goodwill	4,343.2
Brands, trademarks and other intangibles	2,167.3
Other assets	27.7
Total assets acquired	$	8,778.5
Liabilities assumed:
Current liabilities	$	616.3
Noncurrent liabilities	3,091.3
Total liabilities assumed	$	3,707.6
Net assets acquired	$	5,070.9

As a result of the acquisition, we recognized a total of $4.34 billion of goodwill and $2.17 billion of brands, trademarks and other intangibles. Amortizable brands, trademarks and other intangibles totaled $2.03 billion. Indefinite lived brands, trademarks and other intangibles totaled $134.1 million. Of the total goodwill, $397.0 million is deductible for tax purposes. The allocation of goodwill to the Ralcorp Food Group and Ralcorp Frozen Bakery Products segments is pending further analysis.

In August 2012, we acquired the P.F. Chang's^® and Bertolli^® brands frozen meal business from Unilever for $266.9 million in cash. Products will continue to be produced by Unilever under transactions services and contract manufacturing agreements until the end of calendar year 2013. Approximately $100.1 million of the purchase price was allocated to goodwill and $91.8 million was allocated to brands, trademarks and other intangibles. The amount allocated to goodwill is deductible for tax purposes. This business is included in the Consumer Foods segment.

For each of these acquisitions, the amounts allocated to goodwill were primarily attributable to anticipated synergies, product portfolios, and other intangibles that do not qualify for separate recognition.

Under the acquisition method of accounting, the assets acquired and liabilities assumed in these acquisitions were recorded at their respective estimated fair values at the date of acquisition.

The following unaudited pro forma financial information presents the combined results of operations as if the acquisitions of Ralcorp and the P.F. Chang's and Bertolli brands' frozen meal business (collectively, the "acquirees") had occurred at the beginning of the fiscal year acquired. The acquirees' pre-acquisition results have been added to ConAgra Foods' historical results. The pro forma results contained in the table below include adjustments for amortization of acquired intangibles and depreciation expense, as well as related income taxes.

These pro forma results may not necessarily reflect the actual results of operations that would have been achieved, nor are they necessarily indicative of future results of operations.



	Thirteen weeks ended
	August 26, 2012
Pro forma net sales	$	4,421.1
Pro forma net income from continuing operations	$	281.0
Pro forma net income from continuing operations per share—basic	$	0.69
Pro forma net income from continuing operations per share—diluted	$	0.68

Subsequent to the end of the first quarter of fiscal 2014, we agreed to acquire frozen dessert production assets from Harlan Bakeries. We expect the total purchase price to be approximately $39.0 million in cash. The agreement includes the purchase of machinery, operating systems, warehousing/storage, and other assets associated with making frozen fruit pies, cream pies, pastry shells, and loaf cakes. We anticipate final settlement of the purchase to be completed in the second quarter of fiscal 2014.