Ralcorp Board of Directors Agrees in Principle to Separate Ralcorp and Post Foods in a Tax-Free Spin-Off to Ralcorp Shareholders

Ralcorp Holdings, Inc.

today announced that its Board of Directors has unanimously agreed in principle to separate Ralcorp and Post Foods in a tax-free spin-off to Ralcorp shareholders. The Company expects to complete the separation in approximately four to six months, following the receipt of an Internal Revenue Service tax ruling and/or satisfactory legal opinion as to the tax-free nature of the transaction, final approval by the Ralcorp Board of Directors and other customary conditions. The transaction does not require approval from Ralcorp shareholders. Following completion of the transaction, Ralcorp will continue to trade on the New York Stock Exchange

and Post Foods is also expected to be listed on the NYSE. As part of the separation, Post Foods will issue between $1.1 to $1.2 billion of debt with the net cash proceeds of approximately $1 billion going to Ralcorp. Ralcorp's Board of Directors intends to use these proceeds to reduce debt, aggressively pursue private brand acquisitions and pursue additional share repurchases under the Company's remaining share repurchase authorization of approximately five million shares.