Sara Lee, Exelis, Zynga Achieve 52-Week Stock Price Highs as S&P Finishes at 1,369

Sara Lee Corp. (NYSE:SLE): Sara Lee has received a private letter ruling and is now able to provide additional details about the spin-off of its international Coffee & Tea business. The spin-off is expected to be completed by the end of June 2012. Post spin-off, the Coffee & Tea business will be domiciled as a new publicly traded company incorporated in the Netherlands. Additional Spin-Off Details: Sara Lee will spin-off all of the shares of its U.S. subsidiary that holds its Coffee & Tea business. Immediately after this spin-off occurs, the U.S. subsidiary will pay a $3.00 special dividend to Sara Lee shareholders. Subsequently, a new Dutch company will be established as the parent company for the Coffee & Tea business and its shares will be distributed to Sara Lee shareholders. As a consequence of the spin-off and subject to final approval of the spin by the Board, Sara Lee expects to release approximately $700M of deferred tax liabilities currently on its balance sheet. This reversal is expected to occur in the fiscal quarter of the spin-off. The domiciliation of the Coffee & Tea business in the Netherlands is expected to result in U.S. shareholders incurring U.S. tax on any gain attributable to their Coffee & Tea shares. The Coffee & Tea business also intends to move its operating headquarters from Utrecht to Amsterdam in 2H of CY12. At the time of the spin-off, Sara Lee now expects to have total debt of approximately $1.7B and approximately $300M in cash. The shares closed at $21.83, up $1.44 or 7.06% on the day. They have traded in a 52-week range of $15.66 to $20.64.

Exelis Inc. Common (XLS): ITT Exelis sees FY12 EPS $1.80-$1.86 versus consensus $1.59. The shares closed at $11.38, up $0.71 or 6.65% on the day. They have traded in a 52-week range of $8.25 to $13.50.

Zynga Inc. (NASDAQ:ZNGA):Piper Jaffray believes Zynga’s business strategy is moving towards partnering with third-party game developers with the launch of Zynga.com. The firm expects the new website to be accretive beginning in the June quarter and reiterates an Overweight rating on Zynga shares with a $16.50 price target. The shares closed at $14.69, up $0.21 or 1.45% on the day. They have traded in a 52-week range of $7.97 to $14.62.

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To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com