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Sara Lee and IBM Sign Seven-Year Global Services Agreement


Global Initiative Aimed to Drive Profitable Growth

ARMONK, NY - IBM (NYSE: IBM) announced that it has signed a seven-year agreement with Sara Lee Corporation (NYSE: SLE) to manage and maintain pieces of the consumer products company’s global back office operations. IBM will manage a portion of Sara Lee’s North American and European Finance (transaction processing) and Global Information Services (applications development and maintenance) groups, as well as the company’s global indirect procurement activities.

As part of its long-term strategy, Sara Lee is building on leading market share positions, leveraging opportunities in emerging markets and driving efficiencies to spur worldwide growth. The company is simplifying its organization to achieve efficiencies through process discipline, functional centers of excellence, integrated supply chains and outsourcing work where appropriate. Through IBM’s proposed integrated approach, Sara Lee will look to drive additional cost and efficiency improvements. The transfer of activities will happen in a phased approach in accordance with local consultation requirements.

The agreement between Sara Lee and IBM includes the following:

* Finance & Accounting Solution (F&A) - IBM’s F&A approach is based on its experience providing services to global consumer products companies and provides a flexible platform to accommodate Sara Lee’s business requirements. This solution aims to provide significant savings to the company as it increases the quality of process delivery, deploys new standardized tools, utilizes IBM’s Manila Global Delivery Center and dedicates onsite F&A professional support during the transition process.

* Indirect Procurement Services - This includes indirect procurement processes, strategic sourcing, category management, and transactional processes that are tightly integrated with accounts payable to enable compliance and drive savings.

* Application Development and Maintenance Service - With online support from IBM’s existing Centers of Excellence (CoE) throughout the world, Sara Lee will benefit from a proven ADM model. IBM will set up a Sara Lee CoE in India, where ADM services will be provided for the company’s global operations. As a result of the agreement IBM has been granted “preferred supplier” status for future information technology applications development activity.

“Sara Lee’s move to globally integrated, back office shared services will be accelerated by their work with IBM,” said Bill Gilmour, general manager for IBM Consumer Products. “Working with IBM, Sara Lee will quickly establish an efficient and effective infrastructure utilizing proven transition methodologies and skilled and dedicated project management resources which will allow them to focus on driving growth in their business.”

Theo de Kool, Sara Lee’s executive vice president and chief financial and administrative officer, added, “IBM is a trusted and long-standing partner of Sara Lee, with deep experience in large, global programs. Through their worldwide Centers of Excellence, IBM has industry-specific competencies on a global scale and capabilities to secure qualified resources.”

About Sara Lee Corporation

Each and every day, Sara Lee (NYSE: SLE) delights millions of consumers and customers around the world. The company has one of the world’s best-loved and leading portfolios with its innovative and trusted food, beverage, household and body care brands, including Ambi Pur, BallPark, Douwe Egberts, Hillshire Farm, Jimmy Dean, Kiwi, Sanex, Sara Lee and Senseo. Collectively, these brands generate more than $13 billion in annual net sales covering approximately 200 countries. The Sara Lee community consists of 44,000 employees worldwide.

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