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Thomas H. Lee sells Michael Foods to GS Capital for USD1.7bn

Michael Foods’ parent, M-Foods Holdings, has signed a definitive agreement under which its owners, affiliates of Thomas H. Lee Partners, and certain current and former members of management, will sell Michael Foods to affiliates of GS Capital Partners.

The transaction, which is expected to close in the next two months and is subject to customary closing conditions, values Michael Foods at approximately USD1.7bn.

Michael Foods is a producer and distributor of food products to the food service, retail and food ingredient markets. Its principal products are specialty egg products, refrigerated potato products, cheese and other dairy-case products.

Thomas H. Lee, which acquired Michael Foods in 2003, will retain an ownership stake of approximately 20 per cent as part of the transaction.

"We’re pleased with the growth and performance milestones we have achieved over the past several years and appreciate the world-class strategic and operational support we have received from Thomas H. Lee during that time," says chief executive officer and president James E. Dwyer, Jr. "Looking ahead, we’re enthusiastic about our new partnership with GS Capital Partners. We believe Michael Foods will continue to build value by delivering innovative, high-quality products and outstanding service to our growing roster of customers."

"We are excited by the opportunity to partner with Thomas H. Lee, Jim Dwyer and management in Michael Foods," says Adrian Jones, managing director at GS Capital Partners. "We look forward to working with this team to build on the company’s leading market position in the egg category, and to pursue new opportunities for growth."

"Michael Foods is a great company that has produced strong results, and we are very pleased with our investment," adds Kent R. Weldon, managing director at Thomas H. Lee. "We are confident in Michael Foods’ continuing prospects for strong performance and are pleased to be maintaining an ownership stake in the company."

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