ST. LOUIS — Ralcorp Holdings, Inc. said last week that it is considering selling its remaining 6.8 million shares in its Post cereal business, which includes such brands as Honey Bunches of Oats, Shredded Wheat and Raisin Bran.
Ralcorp completed a spin-off of Post Holdings Inc. in early February by distributing at least 80% of the outstanding shares of Post common stock to holders of Ralcorp common stock as of the close of business on Jan. 30. Each shareholder received one share of Post common stock for every two shares of Ralcorp common stock held on Jan. 30.
In connection with the transactions, Ralcorp received $775 million and expects to receive an additional $125 million, which the company said it planned to use “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.”
Post Holdings shares have traded within a fairly narrow range on the New York Stock Exchange since the spin-off from Ralcorp. After closing in January at $26.95 per share, Post shares have closed each month in a price range of $29.49 to $32.93 per share.
Shortly after the spin-off, Ralcorp acquired Silver Creek, N.Y.-based Petri Baking Products, Inc., a producer of private label wire-cut cookies, in May, and Gelit S.r.l., a producer of private label frozen meals in Italy, in June.
Ralcorp produces a variety of private label foods sold under the individual labels of various grocery, mass merchandise and drugstore retailers, and frozen bakery products sold to in-store bakeries, restaurants and other food service customers. The company’s product mix includes ready-to-eat and hot cereals; nutritional and cereal bars; snack mixes, corn-based chips and extruded corn snack products; crackers and cookies; snack nuts; chocolate candy; salad dressings; mayonnaise; peanut butter; jams and jellies; syrups; sauces; frozen griddle products including pancakes, waffles, and french toast; frozen biscuits and other frozen pre-baked products, such as bread and muffins; frozen and refrigerated doughs; dry pasta; and frozen ready meals.