Filed by The J. M. Smucker Company
Commission File No. 333-73830
Subject Company: The Procter & Gamble Company
Pursuant to Rule 425 under the Securities Act of 1933
This document is being filed pursuant to Rule 425 under the Securities Act of
1933 and is deemed filed pursuant to Rule 14a-12 under the Securities Exchange
Act of 1934.
[SMUCKER'S LOGO]
[SMUCKER'S LOGO] [JIF LOGO]
THE J. M. SMUCKER COMPANY
FORWARD LOOKING INFORMATION
THIS PRESENTATION CONTAINS CERTAIN FORWARD-LOOKING STATEMENTS THAT ARE SUBJECT
TO RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY.
THESE INCLUDE STATEMENTS REGARDING ESTIMATES OF FUTURE EARNINGS AND CASH FLOWS
AND EXPECTATIONS AS TO THE CLOSING OF THE TRANSACTION. OTHER UNCERTAINTIES
INCLUDE, BUT ARE NOT LIMITED TO, GENERAL ECONOMIC CONDITIONS WITHIN THE U.S.,
STRENGTH OF COMMODITY MARKETS FROM WHICH RAW MATERIALS ARE PROCURED AND THE
RELATED IMPACT ON COSTS, ABILITY TO OBTAIN REGULATORY AND SHAREHOLDERS'
APPROVAL, INCLUDING WITHOUT LIMITATION A PRIVATE LETTER RULING FROM THE INTERNAL
REVENUE SERVICE, INTEGRATION OF THE ACQUIRED BUSINESSES IN A TIMELY AND COST
EFFECTIVE MANNER, 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 REPORTS FILED BY THE COMPANY WITH THE
SECURITIES AND EXCHANGE COMMISSION, INCLUDING FORMS 10-Q AND 10-K.
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DISCLOSURE
THE COMPANY HAS FILED A PROXY STATEMENT/PROSPECTUS AND OTHER RELEVANT DOCUMENTS
CONCERNING THE PROPOSED MERGER OF THE JIF AND CRISCO BUSINESSES WITH AND INTO
THE COMPANY WITH THE SEC. INVESTORS ARE URGED TO READ THE PROXY STATEMENT/
PROSPECTUS AND ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC BECAUSE THEY
CONTAIN IMPORTANT INFORMATION ON THE PROPOSED MERGER. INVESTORS ARE ABLE TO
OBTAIN THE DOCUMENTS FREE OF CHARGE AT THE SEC'S WEB SITE (WWW.SEC.GOV). IN
ADDITION, DOCUMENTS FILED WITH THE SEC BY THE COMPANY WITH RESPECT TO THE
PROPOSED TRANSACTION MAY BE OBTAINED FREE OF CHARGE BY CONTACTING THE J. M.
SMUCKER COMPANY, STRAWBERRY LANE, ORRVILLE, OHIO, 44667, ATTENTION: INVESTOR
RELATIONS OR BY TELEPHONE AT (330) 682-3000. THE COMPANY AND ITS DIRECTORS AND
EXECUTIVE OFFICERS MAY BE DEEMED TO BE PARTICIPANTS IN THE SOLICITATION OF
PROXIES FROM THE COMPANY'S SHAREHOLDERS. A LIST OF THE RESUMES OF THOSE
DIRECTORS AND EXECUTIVE OFFICERS AND DESCRIPTIONS OF THEIR INTEREST IN THE
COMPANY IS CONTAINED IN THE COMPANY'S PROXY STATEMENT DATED JULY 10, 2001, WHICH
IS FILED WITH THE SEC. THE COMPANY'S SHAREHOLDERS MAY OBTAIN ADDITIONAL
INFORMATION ABOUT THE INTERESTS OF DIRECTORS AND EXECUTIVE OFFICERS IN THE
PROPOSED MERGER BY READING THE PROXY STATEMENT PROSPECTUS. INVESTORS SHOULD READ
THE PROXY STATEMENT/PROSPECTUS CAREFULLY BEFORE MAKING ANY VOTING OR INVESTMENT
DECISION.
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THE J.M. SMUCKER COMPANY
[JIF, SMUCKER'S, AND CRISCO PHOTO]
[SMUCKER'S LOGO] [JIF LOGO]
THE "NEW" J. M. SMUCKER COMPANY
[JIF LOGO] [SMUCKER'S LOGO] [CRISCO LOGO]
- Three #1 American Icon Food Brands
- Highly Accretive Transaction
- Strong Cash Flow and Balance Sheet
- Platform for Future Growth
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[SMUCKER'S LOGO] [JIF LOGO]
SMUCKER'S, JIF AND CRISCO
-- A POWERFUL COMBINATION --
- #1 American icon brands
- Strategic fit
- Complements broker network
- Similar customers and consumers
- #1 market position
- Profitable, "center of store"
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[SMUCKER'S LOGO] [JIF LOGO]
[JIF, SMUCKER'S, AND CRISCO PICTURE]
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[SMUCKER'S LOGO] [JIF LOGO]
[SMUCKER'S PICTURE] [SMUCKER'S PICTURE]
[SMUCKER'S PICTURE] [R.W. KNUDSEN PICTURE]
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SMUCKER
BRAND LEADERSHIP
[BAR GRAPH]
Size of % Dollar Share
Category of Category
------------ --------------
FRUIT SPREADS $747 million
Smucker's Brand 41.0%
Next Brand 11.2%
NATURAL PEANUT BUTTER $51 million
Smucker's Brand 70.6%
Next Brand 15.1%
ICE CREAM TOPPINGS $106 million
Smucker's Brand 61.5%
Next Brand 23.8%
NATURAL BEVERAGES $100 million
R.W. Knudsen Brand 52.8%
Next Brand 16.7%
Source IRI - 52-week ending December 2001 and SPINS ending November 2001
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[SMUCKER'S LOGO] [JIF LOGO]
THE "NEW" SMUCKER
BRAND LEADERSHIP
[BAR GRAPH]
Size of % Dollar Share
Category of Category
------------ --------------
PEANUT BUTTER $860 million
Jif Brand 33.1%
Next Brand 22.2%
COOKING OILS $900 million
Crisco Brand 24.0%
Next Brand 19.2%
SHORTENING $200 million
Crisco Brand 64.1%
Next Brand 3.5%
Source IRI - 52-week ending May 2001
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OPPORTUNITIES FOR GROWTH
[BAR GRAPH]
Current Smucker "New" Smucker
Categories Categories
$ in Billions $1.0 Billion $3.0 Billion
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NET SALES BY PRODUCT
CATEGORY
BEFORE
(SALES: $650 MILLION)
[PIE CHART]
Fruit Peanut
Spreads Other Snacks Formulated Beverage Butter Toppings/Syrups
------- ----- ------ ---------- -------- ------ ---------------
47% 7% 5% 15% 10% 7% 9%
AFTER
(SALES: $1.3 BILLION)
[PIE CHART]
Fruit Peanut
Spreads Shortening/Oil Other Snacks Formulated Beverage Butter Toppings/Syrups
------- -------------- ----- ------ ---------- -------- ------ ---------------
26% 26% 4% 2% 6% 5% 27% 4%
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[SMUCKER'S LOGO] [JIF LOGO]
BRANDED RETAIL SALES*
% OF COMPANY'S U.S. RETAIL SALES
#1 BRANDS
Smucker 97%
Kraft 80%
General Mills 70%
Campbell 60%
Quaker Oats 51%
H.J. Heinz 41%
Kellogg 32%
ConAgra 21%
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* Lehman Brothers (Smucker Added)
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[SMUCKER'S LOGO] [JIF LOGO]
SMUCKER LEADERSHIP GROWTH
25-YEAR HISTORICAL TREND
[BAR GRAPH]
1977 2002
% SOM 20.0% 41.0%
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SOURCE: IRI NIELSEN
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ENHANCED SHAREHOLDER VALUE
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FINANCIAL PERFORMANCE
Actual Estimated Projected
Standalone Standalone Combined
FYE 4/30 FYE 4/30 FYE 4/30
($ in Millions) 2001(1) 2002 2003(2)
--------------- ------- ---- -------
Revenues $ 651 $ 675 $1,355
EBITDA $ 83 $ 92 $ 210 - $ 225
EBITDA Margin 13% 14% 15% - 17%
Net Income $ 33 $ 32 - $ 33 $ 95 - $ 105
E.P.S. $ 1.30 $ 1.33 - $1.37 $ 1.90 - $ 2.10
(1) Excludes nonrecurring charges and changes in accounting method
(2) Assumes that FY 2003 represents first full year of integration
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SMUCKER SHARE PRICE PERFORMANCE
JANUARY 1, 2000 THROUGH DECEMBER 31, 2001
Date Share Price
----------
1/3/2000 $18.12
2/1/2000 16.72
3/1/2000 14.94
4/3/2000 16.82
5/1/2000 15.12 Class A and Class B Share Combination Announced: $15.47
6/1/2000 17.65
7/3/2000 19.12
8/1/2000 17.81 Class A and Class B Share Combination Effective: $18.50
9/1/2000 19.88
10/2/2000 24.44
11/1/2000 22.38
12/1/2000 24.63
1/2/2001 26.40
2/1/2001 24.95
3/1/2001 25.95
4/2/2001 25.28
5/1/2001 25.98
6/1/2001 25.45
7/2/2001 25.99
8/1/2001 27.16
9/4/2001 28.32
10/1/2001 25.00 Jif and Crisco Merger Announced: $35.50
11/1/2001 33.99
12/3/2001 35.32
NOTE: SMUCKER'S SHARE PRICE FROM 1/1/00 THROUGH 8/28/00 REPRESENTS A
WEIGHTED AVERAGE OF CLASS A AND CLASS B SHARES.
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[SMUCKER'S LOGO] [JIF LOGO]
INCREASED SHAREHOLDER VALUE
POTENTIAL FOR HIGHER MULTIPLE
- Small-cap to mid-cap
- Increased liquidity: 24MM - 49MM shares outstanding
- Increase in share value
- Greater earnings growth potential
- Strong dividend practice will continue
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ENTERPRISE VALUE/EBITDA
[BAR GRAPH]
Wrigley 20.4x
General Mills 18.6x
Tootsie Roll 16.2x
HJ Heinz 15.4x
Tyson Foods 13.7x
Nestle 12.5x
Kellogg 12.5x
Hershey 12.3x
Kraft 12.0x
Dole Food 11.7x
Campbell 11.2x
Sara Lee 10.9x
Conagra 10.0x
Smucker 8.5x
(1) REPRESENTS PRO FORMA TOTAL VALUE OF $1.8 BILLION AND PROFORMA EBITDA
(AS OF 4/30/02) OF $210 MILLION.
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GROWTH STRATEGY
AVERAGE ANNUAL
GROWTH RATE
-----------
Market Share 3%
New Products 1%
Acquisitions 4%
----
Total 8%
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[PHOTO OF SMUCKER'S UNCRUSTABLES]
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GROWTH STRATEGY
- Acquisitions
- Leading brand position
- North American geographic emphasis
- Leverage raw material synergies and plant capacity
- Enabling acquisitions
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TOTAL DEBT/EBITDA
[BAR GRAPH]
Tyson Foods 7.3x
General Mills 6.9x
Dole Foods 4.8x
HJ Heinz 4.4x
Kellogg 4.2x
Conagra 3.5x
Sara Lee 3.0x
Campbell 2.9x
Kraft 2.8x
Hershey 1.3x
Nestle 1.3x
Smucker 0.6x
Tootsie Roll 0.1x
Wrigley 0.0x
(1) REPRESENTS PRO FORMA TOTAL DEBT OF $135 MILLION AND PROFORMA EBITDA
(AS OF 4/30/02) OF $210 MILLION.
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SUMMARY
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THE SMUCKER ADVANTAGE
- Proven ability to grow market share
- Leverage broker network
- Category management
- Financial strength and capabilities
- Consistency of top management team/leadership
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[SMUCKER'S LOGO] [JIF LOGO]
SMUCKER BASIC BELIEFS
BASIC BELIEFS ARE AN EXPRESSION OF THE COMPANY'S VALUES AND PRINCIPLES THAT
GUIDE STRATEGIC BEHAVIOR AND DIRECTION. THE BASIC BELIEFS ARE DEEPLY ROOTED IN
THE PHILOSOPHY AND HERITAGE OF THE COMPANY'S FOUNDER, JEROME MONROE SMUCKER.
QUALITY
Quality applies to our products, our manufacturing methods, our marketing
efforts, our people, and our relationships with each other.
PEOPLE
We will be fair with our employees and maintain an environment that encourages
personal responsibility within the Company and the community.
ETHICS
The same, strong ethical values on which our Company was founded provide the
standards by which we conduct our business as well as ourselves.
GROWTH
Along with day-to-day operations, we are also concerned with the potential of
our Company and its employees.
INDEPENDENCE
We have a strong commitment to stewardship of the Smucker name and heritage.
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[SMUCKER'S LOGO] [JIF LOGO]
THE "NEW" J. M. SMUCKER COMPANY
[JIF LOGO] [SMUCKER'S LOGO] [CRISCO LOGO]
- Three #1 American Icon Food Brands
- Highly Accretive Transaction
- Strong Cash Flow and Balance Sheet
- Platform for Future Growth
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[SMUCKER'S LOGO]
[JIF LOGO] [CRISCO LOGO]