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DISCONTINUED OPERATIONS, OTHER ASSETS HELD FOR SALE, AND THE FORMATION OF ARDENT MILLS | 9 Months Ended
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Feb. 22, 2015
Discontinued Operations and Disposal Groups [Abstract] |
DISCONTINUED OPERATIONS, OTHER ASSETS HELD FOR SALE, AND THE FORMATION OF ARDENT MILLS | DISCONTINUED OPERATIONS, OTHER ASSETS HELD FOR SALE, AND THE FORMATION OF ARDENT MILLS Formation of Ardent Mills On May 29, 2014, the Company, Cargill, Incorporated, and CHS, Inc. completed the formation of Ardent Mills. In connection with the formation, we contributed all of the assets of ConAgra Mills, including $49.0 million of cash, to Ardent Mills, we received a 44% ownership interest in Ardent Mills, and Ardent Mills distributed $391.4 million in cash to us as a return of capital. The contribution of the assets of ConAgra Mills in exchange for a non-controlling interest in the newly formed joint venture is required to be accounted for at fair value, and accordingly, we recognized a gain of $625.6 million ($375.9 million after-tax) in fiscal 2015 in income from discontinued operations, to reflect the excess of the fair value of our interest over its carrying value at the time of the transfer. As part of the formation of Ardent Mills, in the fourth quarter of fiscal 2014, pursuant to an agreement with the U.S. Department of Justice, we sold three flour milling facilities to Miller Milling Company LLC for $163.0 million. We received the cash proceeds from the sale of these flour milling facilities in the first quarter of fiscal 2015. In the first quarter of fiscal 2015, we used the net cash proceeds from the Ardent Mills transaction to repay debt. The operating results of our legacy milling business, including the disposition of three mills aforementioned, are included as discontinued operations within our Condensed Consolidated Statement of Earnings. The related assets and liabilities have been reclassified as assets and liabilities held for sale within our Condensed Consolidated Balance Sheet for the period presented prior to divestiture. We recognized the 44% ownership interest in Ardent Mills at fair value, as of the date of the formation of the joint venture. We now recognize our proportionate share of the earnings of Ardent Mills under the equity method of accounting within results of continuing operations. Due to differences in fiscal reporting periods, we recognized the equity method earnings on a lag of approximately one month; and as a result, we recognized only eight months of earnings from Ardent Mills in the first three quarters of fiscal 2015. At February 22, 2015, the carrying value of our equity method investment in Ardent Mills was $745.6 million, which is included in Other Assets. We entered into transition services agreements in connection with this contribution and recognized $3.5 million and $10.8 million of income for the performance of transition services during the third quarter and first three quarters of fiscal 2015, respectively, classified within selling, general and administrative expenses. Medallion Foods In the fourth quarter of fiscal 2014, we completed the sale of a small snack business, Medallion Foods, for $32.0 million in cash. The business results were previously reflected in the Private Brands segment. We reflected the results of these operations as discontinued operations for all periods presented. In the third quarter of fiscal 2014, we recognized an impairment charge related to allocated amounts of goodwill and intangible assets, totaling $25.4 million ($15.2 million after-tax), in anticipation of this divestiture. Lightlife® Operations In the second quarter of fiscal 2014, we completed the sale of the assets of the Lightlife® business for $54.7 million in cash. This business produced and sold vegetarian-based burgers, hot dogs, and other meatless frozen and refrigerated items. The results of this business were previously reflected in the Consumer Foods segment. We reflected the results of these operations as discontinued operations for all periods presented. We recognized a pre-tax gain of $32.1 million ($19.8 million after-tax) on the sale of this business in the second quarter of fiscal 2014. The summary comparative financial results of discontinued operations were as follows:
| Thirteen weeks ended |  | Thirty-nine weeks ended
| February 22, 2015 |  | February 23, 2014 |  | February 22, 2015 |  | February 23, 2014
Net sales | $ | — |  |  | $ | 459.2 |  |  | $ | 16.2 |  |  | $ | 1,443.6 |
Net gain on sale of businesses | $ | — |  |  | $ | — |  |  | $ | 627.3 |  |  | $ | 32.1 |
Long-lived asset impairment charge | — |  |  | (25.4 | ) |  | — |  |  | (25.4 | )
Income (loss) from operations of discontinued operations before income taxes and equity method investment earnings | 0.3 |  |  | 38.6 |  |  | (10.1 | ) |  | 94.0 |
Income before income taxes | 0.3 |  |  | 13.2 |  |  | 617.2 |  |  | 100.7 |
Income tax expense | 0.9 |  |  | 2.5 |  |  | 255.2 |  |  | 34.3 |
Equity method investment earnings | — |  |  | 0.1 |  |  | — |  |  | 0.2 |
Income (loss) from discontinued operations, net of tax | $ | (0.6 | ) |  | $ | 10.8 |  |  | $ | 362.0 |  |  | $ | 66.6 |
Other Assets Held for Sale During the third quarter of fiscal 2014, we began actively marketing for sale an onion processing facility previously acquired from an onion products supplier. During the third quarter of fiscal 2015, we sold the processing facility for cash proceeds of $11.0 million, resulting in an immaterial gain. The processing facility assets have been reclassified as assets held for sale within our Condensed Consolidated Balance Sheets for the period presented prior to sale. These assets were held within our Commercial Foods segment. The assets and liabilities classified as held for sale reflected in our Condensed Consolidated Balance Sheets were as follows:
|  | May 25, 2014
Cash and cash equivalents |  | $ | 41.8 |
Receivables, less allowance for doubtful accounts of $1.2 |  | 172.4 |
Receivable on sale of flour milling assets |  | 162.4 |
Inventories |  | 215.6 |
Prepaid expenses and other current assets |  | 39.5 |
Current assets held for sale |  | $ | 631.7 |
Property, plant and equipment, net |  | $ | 186.8 |
Goodwill |  | 8.0 |
Brands, trademarks and other intangibles, net |  | 0.9 |
Other assets |  | 3.2 |
Noncurrent assets held for sale |  | $ | 198.9 |
Current installments of long-term debt |  | $ | 0.1 |
Accounts payable |  | 143.1 |
Accrued payroll |  | 2.3 |
Other accrued liabilities |  | 19.3 |
Current liabilities held for sale |  | $ | 164.8 |
Senior long-term debt, excluding current installments |  | $ | 0.1 |
Other noncurrent liabilities |  | 1.9 |
Noncurrent liabilities held for sale |  | $ | 2.0 |

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- Definition The entire disclosure for the facts and circumstances leading to the completed or expected disposal, manner and timing of disposal, the gain (loss) recognized in the income statement and the income statement caption that includes that gain (loss), amounts of revenues and pretax profit or loss reported in discontinued operations, the segment in which the disposal group was reported, and the classification (whether sold or classified as held for sale) and carrying value of the assets and liabilities comprising the disposal group. Includes all disposal groups, including those classified as components of the entity (discontinued operations). + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6391110&loc=d3e2941-110230 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1361-107760 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 45 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6892542&loc=d3e957-107759 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 45 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=6892542&loc=d3e1012-107759 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1510-107760 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 45 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6892542&loc=d3e1020-107759 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1436-107760 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 20 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6360339&loc=d3e1474-107760 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 360 -SubTopic 10 -Section 45 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=8077374&loc=d3e2443-110228 + Details
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