Big deals, baby meals among acquisition highlights in the second quarter

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KANSAS CITY – Snacks, specialty bread and baby food were popular purchases among food corporations during the second quarter.

In the snack category, Campbell Soup Co. bought Denmark-based cookie and cracker maker Kelsen Group A/S in June, and B&G Foods, Inc. topped off its snack portfolio with the May acquisition of TrueNorth nut clusters and the June agreement to buy Pirate Brands better-for-you snacks for about $195 million. Campbell also was among several companies to snap up organic baby food brands during the quarter with its purchase of Plum Organics finalized in June, following the May acquisitions of Happy Family by Danone and Ella’s Kitchen, Ltd. by the Hain Celestial Group, Inc.

But perhaps the biggest news in merger and acquisition activity during the quarter was the May announcement of Hong Kong-based meat processor Shuanghui International Holdings Ltd.’s approximate $7.1 billion offer to acquire Smithfield Foods, Inc.

As the largest acquisition of an American company by a Chinese company, the deal raised concerns for lawmakers, prompting a meeting between Smithfield Foods and the U.S. Senate Committee on Agriculture, Nutrition and Forestry in July.  During his testimony, C. Larry Pope, chief executive officer of Smithfield Foods, said: “This transaction will give Smithfield new channels to market and the strongest distribution network in China. By combining Shuanghui and Smithfield, we will accelerate both companies’ strategic plans, broaden our market reach and create exciting growth opportunities.”

Other large deals during the quarter included the completion of the $28 billion takeover of H.J. Heinz Co. by Berkshire Hathaway and 3G Capital, as well as an offer valued at €7.5 billion ($9.8 billion) to acquire the D.E Master Blenders 1753 coffee company by a German investor group.

Food Business News compiled merger and acquisition activity in the food and beverage industry that occurred during the second quarter. Click the links to read more about each deal.

 

Grupo Bimbo S.A.B. de C.V., Mexico City, in April completed its $31.9 million purchase of the Beefsteak brand from Hostess Brands, Inc., Irving, Texas. The transaction was funded with cash holdings. Click here for the story.

Tate & Lyle P.L.C., a London-based global provider of specialty food ingredients and solutions, in May acquired Biovelop, a Swedish manufacturer of oat beta glucan. Financial terms of the transaction were not disclosed. Click here for the story.

The Bit-O-Honey confectionery brand from Nestle USA, Inc. was acquired in May by Greenwich, Conn.-based Brynwood Partners VI L.P. through its Pearson Candy Co. Terms of the transaction were not disclosed. Click here for the story.

TreeHouse Foods, Inc., Oak Brook, Ill., in June entered an agreement to acquire Cains Foods, L.P. for $35 million. Cains Foods is a manufacturer of mayonnaise, dressings and sauces that includes private label brands as well as the Cains, Naturally Delicious and Olde Cape Cod brands. Click here for the story.

Stellarton, N.S.-based Sobeys, Inc., a wholly-owned subsidiary of Empire Company Ltd., in June agreed to acquire Canada Safeway Ltd., the Canadian business of Pleasanton, Calif.-based Safeway, Inc., for approximately $5.7 billion (C$5.8 billion). Click here for the story.

Tyson Foods, Inc., Springdale, Ark., in June acquired Circle Foods L.L.C., San Diego, from Claridge, Inc., a private equity investment company headquartered in Montreal. Circle Foods is a manufacturer of frozen and refrigerated handheld Mexican foods, uncooked tortillas and Indian flatbreads. Terms of the acquisition were not disclosed. Click here for the story.

Boston-based Thomas H. Lee Partners L.P. and an affiliate of Goldman, Sachs & Co. in May entered an agreement to acquire CTI Foods, a food service provider with products including value-added proteins, soups and dressings, from Littlejohn & Co., L.L.C. The transaction was expected to close during the second quarter of 2013. Click here for the story.

Boulder, Colo.-based Boulder Brands, Inc. in May acquired Davies Bakery, a United Kingdom-based gluten-free bakery and bread manufacturer, for approximately £2.5 million ($3.9 million). Click here for the story.

An investor group led by Joh. A. Benckiser GmBH, Ludwigshafen, Germany, in April made an offer to acquire the D.E Master Blenders 1753 coffee company, Amsterdam, The Netherlands, for €12.50 ($16.36) per share. The total offer is valued at €7.5 billion ($9.8 billion). Click here for the story.

Jacksonville, Fla.-based Bi-Lo Holdings, L.L.C., parent company of Bi-Lo and Winn-Dixie grocery chains, in May entered into a definitive agreement with Delhaize Group, a Brussels, Belgium-based international food retailer, to acquire its Sweetbay, Harveys and Reid’s supermarket banners for $265 million. Click here for the story.

Westin Foods, an Omaha-based packaged foods business, in April expanded its health and wellness division by acquiring a majority interest in St. Augustine, Fla.-based Dominex, L.C., a producer of eggplant-based appetizers and entrees, to create Dominex Natural Foods. Financial terms of the transaction were not disclosed. Click here for the story.

The Hain Celestial Group, Inc., Lake Success, N.Y., in May purchased Ella’s Kitchen Group, Ltd., a maker of organic baby food with 80 products offered in the United Kingdom, the United States and Scandinavia. Financial terms of the transaction were not disclosed. Click here for the story.

Archer Daniels Midland Co., Sydney, Australia, in April entered into an agreement to acquire GrainCorp Ltd. in a transaction valued at approximately A$3.4 billion ($3.5 billion). Click here for the story.

Danone, Paris, in May entered into an agreement to acquire a majority interest in the Happy Family brand of organic baby food products. Terms of the agreement were not disclosed. Click here for the story.

Post Holdings, Inc., a St. Louis manufacturer, marketer and distributor of branded ready-to-eat cereals, in May acquired the branded and private label cereal, granola and snacks business of Hearthside Food Solutions, a portfolio company of Wind Point Partners, for $158 million. The acquisition included Golden Temple, Peace Cereal, Sweet Home Farm and Willamette Valley Granola Co. brands of Hearthside Food, as well as the company’s private label granola business. Click here for the story.

Berkshire Hathaway and 3G Capital completed its acquisition of Pittsburgh-based H.J. Heinz Co. in June. The transaction, valued at $28 billion, including the assumption of outstanding debt, was first announced on Feb. 14 and met shareholder approval on April 30. Click here for the story.

Prinsburg, Minn.-based Harvest Granola L.L.C., a subsidiary of Indian Harvest Specialtifoods, in April purchased Olympia Granola, a maker of granola bars based in North Branch, Minn. Financial terms were not disclosed. Click here for the story.

Campbell Soup Co., Camden, N.J., in June agreed to acquire Denmark-based baked snacks producer Kelsen Group A/S from private equity firm Maj Invest and other investors. Terms of the transaction were not released. Click here for the story.

Labriola Baking Co., an Alsip, Ill.-based baker of fresh and frozen artisan bread, in June was acquired by the private equity firm Plaza Belmont Fund III L.P., Shawnee Mission, Kas., and several other investors. Terms of the agreement were not announced. Click here for the story.

Labriola Baking Co. supplies fresh artisan baked foods through its own distribution network of 25 routes to hotels, restaurants and retail stores in the Milwaukee, Chicago and Indianapolis regions.

Arbor Investments, a Chicago-based private equity firm, in June completed the acquisition of The New French Bakery, Inc., a specialty baker located in Minneapolis. Terms of the transaction were not announced. Click here for the story.

Minneapolis-based frozen entree manufacturer Bellisio Foods in May entered into an agreement to acquire Overhill Farms, Los Angeles, a maker of custom prepared frozen foods, including those marketed under the Boston Market brand, for approximately $80 million. Click here for the story.

Minnetonka, Minn.-based M.G. Waldbaum Co., a subsidiary of Michael Foods, Inc., in June entered into an agreement to acquire the assets of Primera Foods Corp. The transaction includes Primera’s manufacturing assets located in Britt, Iowa, and Altura, Minn., where Primera produces value-added egg products. Click here for the story.

B&G Foods, Inc., Parsippany, N.J., in June agreed to acquire Robert’s American Gourmet Foods, L.L.C. dba Pirate Brands for about $195 million from VMG Partners, Driven Capital Management, Robert Ehrlich and others. The acquisition includes the Pirate’s Booty snack foods brand. The acquisition was expected to close in July. Click here for the story.

Campbell Soup Co., Camden, N.J., in June completed its acquisition of Plum Organics, an Emryville, Calif.-based maker of foods and snacks for babies, toddles and children. Terms of the transaction were not disclosed. Click here for the story.

Hong Kong-based Shuanghui International Holdings Ltd., a majority shareholder of China’s largest meat processing enterprise, in May entered an agreement to acquire Smithfield Foods, Inc., Smithfield, Va., for approximately $7.1 billion, including assumption of debt. Click here for the story.

B&G Foods, Inc., Parsippany, N.J., in May acquired the TrueNorth brand of snack nuts from DeMet’s Candy Co., a portfolio company of Brynwood Partners V L.P. Terms of the transaction were not disclosed. Click here for the story.

Inventure Foods, Inc., Phoenix, in May completed its acquisition of the berry processing business of Willamette Valley Fruit Company, L.L.C., Salem, Ore. As a part of the transaction, Inventure said it has assumed liabilities relating to business contracts after the closing date and paid an aggregate amount of $9.5 million. Click here for the story.
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READER COMMENTS (1)

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