Why is my statement odd?
It would be odd if P&G went as far as it did with the deal before the rumor started if P&G didn't already have shareholders committed to the merger deal. Do you think they'd get to the end and say "Oh wait, we have to go find enough shareholders willing to give up their shares first."? You may get an opportunity in the future, but there's already enough commitment in place regardless of whether you are willing to give up yours when you get the opportunity.
"and then spin off to PG share holders.
That's also a good alternative."
PG's deal with DMND is using a Morris Trust for the tax advantages it offers. The method you suggest would not be as efficient; otherwise, why didn't PG simply spin off Pringles to its shareholders (and other divested assets) in the first place?
"PG can buy the whole company right now if they wanted too"
And your point is?
Sure PG could buy DMND, but that would be an about face for the company. PG has been DIVESTING its food businesses.
While PG could by DMND, they, like just about every other company out there, would not seriously consider buying a (temporarily?) tainted company like DMND.
"While PG could by DMND, they, like just about every other company out there, would not seriously consider buying a (temporarily?) tainted company like DMND. "
Why not? I could see why other's wouldn't want to buy Diamond, but P&G is in the unique position of taking Diamond's assets and selling them on a much bigger mass scale.
You are correct that P&G does not want to manage food products anymore. That's why a certain percentage of P&G stockholders have already agreed to have their P&G stock spun off as owners of the Pringle's asset and Pringle's debt.
Those stocks and the Pringles assets and debt are being merged with Diamond stock and the Kettle/Pop Secret/Emerald assets and debt. Diamnond doesn't need the cash to buy Pringels, because it's merging their stocks, assets and debt with the stock, assets and debt of Pringles. But because the P&G stock and Pringles are being spun off as part of the deal, technically it's Diamond buying Pringles from P&G in exchange for stock and debt.
The benefit to those P&G stockholders who have agreed to this is that now Kettle/Pop Secret/Emerald products can be distributed via the existing Pringles distribution system, which is far larger than Diamonds existing distribution system.
It's the P&G stockholders who have agreed to this that stand to benefit far more than Diamond does.
If getting that deal done meand P&G just buys DMND, and fires all the management, they could do that. But they'd never reveal that intention publically until it happens.
Either way, P&G stockholders who have agreed to this WILL get the Kettle/Pop Secret/Emerald assets and sell them through the Pringles distribution system. Whether that company is called Diamond Foods or Pringles foods really doesn't matter. The employees in the Pringles distribution system are already proceeding with the transformation.