Filed by Tyson Foods, Inc.
Pursuant to Rule 425 under the Securities Act
of 1933 and deemed filed pursuant to Rule 14a-12(b)
under the Securities Act of 1934
Subject Company: IBP, inc.
Commission File No. 1-6085
February 21, 2001
Media Contact: Ed Nicholson
(501) 290-4591
Investor Contact: Louis Gottsponer
(501) 290-4826
TYSON FOODS ADDRESSES CAGNY
NAPLES, Fla. (February 21) - Tyson Foods, Inc. (NYSE: TSN) said today its
growth strategies in chicken are threefold: organizing around key
customers, moving products up the value chain and building on brand
strengths, according to Greg Lee, the Company's chief operating officer, at
the annual Consumer Analyst Group of New York (CAGNY) conference.
Tyson said it expects to generate approximately $35 million in savings in
fiscal 2001 due to supply chain initiatives which have helped to streamline
and leverage purchasing practices to ensure lower input costs on packaging,
ingredients and equipment without sacrificing quality.
"While $35 million is substantial, our expectations are to be annualizing
at the rate of $100 million by year-end. Our attention to capital
expenditures has ensured that we are spending our money most efficiently on
necessary repairs and maintenance, while improving our capital project mix
to include greater investment in cost reduction and income-producing
projects," Lee added.
Speaking about the difficult environment in the poultry industry, Lee said
the key strategies for Tyson have been to cut back bird supply, to
internalize raw materials and to grow sales and market share. While the
cutback in bird supply had the effect of reducing commodity sales, Tyson
has had continued growth in sales and market share in core categories.
"In fact, our demand has risen to the point that we now have to selectively
add a few more birds back into the system to service our business. This
will provide us the ability to lower costs without upsetting the balance of
supply and to service growing demand for specific bird sizes," Lee added.
Looking ahead, Lee said he expects the convenience-food category to
continue to grow substantially as more people enter the job market and have
less time to prepare meals. Within the next nine years, of the estimated
incremental $123 billion growth in food spending, foodservice
establishments are projected to capture more than 60 percent or $76
billion, while the retail market will capture about $47 billion in growth.
Chicken continues to gain a greater share of the foodservice menu with
chicken items being added faster than other meat-based items, according to
Lee.
"We continue to grow the chicken category in foodservice through product
innovations. For example, we rolled out new products in the first quarter
to capitalize on the popularity of handheld appetizers. Chicken now
represents about 25 percent of total appetizers served," Lee said.
John Lea, chief marketing officer, spoke to the growth and strength of the
Tyson brand. He noted significant increases in consumer brand awareness and
the brand perceptions of quality, safety and trust. In describing the
Company's brand building strategies, he highlighted Tyson's $10 million
partnership with and support of Share our Strength, an international hunger
relief organization, and Tyson's environmental recognition and awards
program.
Lea said, "We are clearly being rewarded for our efforts and are very proud
that Fortune magazine recently ranked Tyson as number two among America's
Most Admired Companies in the food processing category."
Steve Hankins, chief financial officer, said the Company's sales had grown
at a compound annual growth rate of 5.4 percent over the past five years.
While 2000 earnings were at a lower level than the previous year, Tyson's
cash flow increased by more than $40 million due to a renewed emphasis on
the cash cycle and less spending on capital projects, according to Hankins.
Commenting on the Company's pending acquisition of IBP, inc. (NYSE: IBP),
John Tyson, chairman, president and CEO, said, "Thinking about the two
companies together, you have industry leadership in beef, chicken and pork,
with the combined market share of those three proteins at close to 25
percent. Our strengths in branding, customer relationships and partnerships
and our focus on value added products and growing demand in retail and
foodservice will combine nicely with IBP. We will truly have a company that
is unique in market and product reach and strong in its capabilities to
generate cash to pay down debt."
As previously announced, Tyson's presentation to CAGNY was broadcast live
on the Internet. The audio presentation and slides are available for replay
until March 21 at
http://www.tyson.com/investorrel/publications/presentations.asp. The audio
replay also is available at 800-475-6701 until March 21. The access code is
570623.
About Tyson Foods, Inc.
Tyson Foods, Inc., headquartered in Springdale, Ark., is the world's
largest fully integrated producer, processor and marketer of chicken and
chicken-based convenience foods, with 68,000 team members and 7,400
contract growers in 100 communities. Tyson has operations in 18 states and
15 countries and exports to 73 countries worldwide. Tyson is the recognized
market leader in almost every retail and foodservice market it serves.
Through its Cobb-Vantress subsidiary, Tyson is also a leading chicken
breeding stock supplier. In addition, Tyson is the nation's second largest
maker of corn and flour tortillas under the Mexican Originalr brand, as
well as a leading provider of live swine.
About IBP, inc.
IBP, inc., headquartered in Dakota Dunes, S.D., is the world's largest
supplier of premium fresh beef and pork products, with more than 60
production sites in North America, joint venture operations in China,
Ireland and Russia and sales offices throughout the world. The Company,
which generated annual sales exceeding $16 billion, employs 50,000 people.
Forward Looking Statements
Certain statements contained in this communication are "forward-looking
statements," such as statements relating to future events and the proposed
Tyson acquisition of IBP. These forward-looking statements are subject to
risks, uncertainties and other factors which could cause actual results to
differ materially from historical experience or from future results
expressed or implied by such forward-looking statements. Among the factors
that may cause actual results to differ materially from those expressed in,
or implied by, the statements are the following: (i) the risk that Tyson
and IBP will not successfully integrate their combined operations; (ii) the
risk that Tyson and IBP will not realize estimated synergies; (iii) unknown
costs relating to the proposed transaction; (iv) risks associated with the
availability and costs of financing, including cost increases due to rising
interest rates; (v) fluctuations in the cost and availability of raw
materials, such as feed grain costs; (vi) changes in the availability and
relative costs of labor and contract growers; (vii) market conditions for
finished products, including the supply and pricing of alternative
proteins; (viii) effectiveness of advertising and marketing programs; (ix)
changes in regulations and laws, including changes in accounting standards,
environmental laws, and occupational, health and safety laws; (x) access to
foreign markets together with foreign economic conditions, including
currency fluctuations; (xi) the effect of, or changes in, general economic
conditions; and (xii) adverse results from on-going litigation. Tyson
undertakes no obligation to publicly update any forward-looking statements,
whether as a result of new information, future events or otherwise.
IMPORTANT INFORMATION
LASSO ACQUISITION CORPORATION ("LASSO"), A WHOLLY OWNED SUBSIDIARY OF TYSON
FOODS, INC. ("TYSON") HAS COMMENCED AN OFFER FOR UP TO 50.1% OF THE
OUTSTANDING SHARES OF COMMON STOCK, OF IBP, INC. ("IBP") AT $30.00 NET PER
SHARE TO SELLER IN CASH. THE OFFER CURRENTLY IS SCHEDULED TO EXPIRE AT
12:00 MIDNIGHT, EASTERN STANDARD TIME, ON WEDNESDAY, FEBRUARY 28, 2001,
UNLESS EXTENDED BY LASSO. TYSON'S OFFER IS BEING MADE ONLY BY WAY OF AN
OFFER TO PURCHASE AND RELATED LETTER OF TRANSMITTAL AND ANY AMENDMENTS OR
SUPPLEMENTS THERETO AND IS BEING MADE TO ALL HOLDERS OF IBP'S SHARES. MORE
DETAILED INFORMATION PERTAINING TO TYSON'S OFFER AND THE PROPOSED EXCHANGE
OFFER AND MERGER WILL BE SET FORTH IN APPROPRIATE FILINGS TO BE MADE WITH
THE SEC, IF AND WHEN MADE. SHAREHOLDERS ARE URGED TO READ ANY RELEVANT
DOCUMENTS THAT MAY BE FILED WITH THE SEC BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION. SHAREHOLDERS WILL BE ABLE TO OBTAIN A FREE COPY OF
ANY FILINGS CONTAINING INFORMATION ABOUT TYSON, LASSO AND IBP, WITHOUT
CHARGE, AT THE SEC'S INTERNET SITE (HTTP://WWW.SEC.GOV). COPIES OF ANY
FILINGS CONTAINING INFORMATION ABOUT TYSON CAN ALSO BE OBTAINED, WITHOUT
CHARGE, BY DIRECTING A REQUEST TO TYSON FOODS, INC., 2210 WEST OAKLAWN
DRIVE, SPRINGDALE, ARKANSAS 72762-6999, ATTENTION: OFFICE OF THE CORPORATE
SECRETARY (501) 290-4000.
Tyson and certain other persons named below may be deemed to be
participants in the solicitation of proxies. The participants in this
solicitation may include the directors and executive officers of Tyson. A
detailed list of the names of Tyson's directors and officers is contained
in Tyson's proxy statement for its 2001 annual meeting, which may be
obtained without charge at the SEC's Internet site (http://www.sec.gov) or
by directing a request to Tyson at the address provided above.
As of the date of this communication, none of the foregoing participants,
individually beneficially owns in excess of 5 percent of IBP's common
stock. Except as disclosed above and in Tyson's proxy statement for its
2001 annual meeting and other documents filed with the SEC, to the
knowledge of Tyson, none of the directors or executive officers of Tyson
has any material interest, direct or indirect, by security holdings or
otherwise, in Tyson or IBP.
This communication is not an offer to purchase shares of IBP, nor is it an
offer to sell shares of Tyson Class A common stock which may be issued in
any proposed merger with IBP or exchange offer for IBP shares. Any issuance
of Tyson Class A common stock in any proposed merger with IBP or exchange
offer for IBP shares would have to be registered under the Securities Act
of 1933, as amended, and such Tyson stock would be offered only by means of
a prospectus complying with the Act.