September 02, 2008 - Sadia S.A. ("Sadia") announces publicly to its Shareholders and to the Market that, on September 1, 2008, it executed the final documentation contemplated in the Partnership Agreement entered into on April 28, 2008 by and between Sadia and Kraft Foods Brasil S.A. ("KFB") & Kraft Foods Holdings, Inc., presently known as Kraft Foods Global Brands, LLC ("Kraft"), already disclosed in the material fact disseminated on that same date, establishing the terms and conditions for setting up a joint venture to operate in Brazil the activities of cheese manufacturing, marketing and distribution, including the products
currently sold by KFB under the Philadelphia brand, as well as cheeses and cheese spreads sold under the Sadia brand.
The joint venture vehicle, K&S Alimentos S.A. ("K&S"), is a closely-held corporation, headquartered in Curitiba-PR. KFB is the title holder of 51% of the voting shares while Sadia holds 49%. Pursuant to the terms of the Shareholders' Agreement signed by the parties within the context of their partnership, K&S shall have its own independent structure and corporate
governance.
As established in the agreement signed between KFB and K&S, K&S shall start up its industrial operation under the mode of manufacturing to order. As of January 2010, these operations will be fully and definitively transferred to K&S
own industrial park.
This partnership with Kraft represents an important step towards strengthening Sadia in the cheese segment and is in full alignment with its strategy of promoting growth and creating value, both for the Company and for its shareholders.