1. Intercompany interest rates Jan Schets Director Treasury
Sara Lee International BV

2. Agenda Introduction Sara Lee Interco interest rates applied
Business cas
Lessons learned

3. A decade of Sara Lee 2002 Diversified company
Operations in 55 countries
US$ 20 bln Net Sales in nearly 200 nations
155,000 employees worldwide

4. A decade of Sara Lee 2003 to 2011 Divested appr. 60% Apparel
European Meats
Direct Selling
Household and Body Care
Bakery

5. A decade of Sara Lee 2011 to 2012 “Sara Lee 2.0” Spin of “CoffeeCo”
US meat business
Spin of “CoffeeCo”
International Coffee & Tea

6. Intercompany interest rates
interest rates for cash pool participants
Utopia: no interest
Practical: use same debit/credit interest as applicable for the cash pool leader
Tax: armslength rates based on credit profile of individual participant

7. Intercompany interest rates
interest rates for interco loans
Short term on demand loans:
Libor + 25 bp
Standard long term loans:
Parent company debt
Parent company rating reference rates

8. Intercompany interest rates
interest rates for interco loans
Special loans:
Benchmark quote bank
Benchmark transaction
Benchmark pricing report

9. Intercompany interest rates
Business case
Temporary statutory equity shortfall
Capital tax of 1%
Profit Participating Loan qualified as equity
Armslength interest rate PPL
3rd party pricing report

10. Intercompany interest rates
Business case
3rd party pricing report
Based on financials and sector
Comparison
Detailed report

11. Lessons learned Documentation Finance policy & Treasury guidelines
Cash pool & Loan documentation
Outlook
Increased focus on armslength rates