AUSTIN, MINN. — Hormel Foods Corp. has entered into an agreement to acquire Applegate Farms, Bridgewater, N.J., for $775 million. Applegate is a manufacturer of natural and organic processed meat and poultry products that is estimated to have sales of $340 million in 2015.
“A growing number of consumers are choosing natural and organic products,” said Jeffrey M. Ettinger, chairman of the board, president and chief executive officer of Hormel. “This deal allows us to expand the breadth of our protein offerings to provide consumers more choice. The Applegate team has built a great brand, and consumers can rest assured there will not be any changes to the way Applegate meats are raised and produced. Together, we can provide a faster path to expanded offerings in this high-growth category.”
Applegate will operate as a standalone subsidiary of Hormel Foods and its financial results will be folded into Hormel’s Refrigerated Foods business unit. Applegate has 100 employees located primarily in Bridgewater.
“Applegate’s consumers won’t see any changes,” said Kerry Collins, c.e.o. of Applegate. “Our products, standards, mission and focus will remain the same. We’re going to continue to make noise to change the food system for the better. When Applegate first started, there were only a handful of antibiotic-free animal farms, and today we work with nearly 1,800 family farms. With Hormel Foods as a partner, Applegate can share our expertise on a much wider scale.”Hormel said the transaction is projected to be neutral to the company’s earnings per share in fiscal 2015 and accretive by approximately 7c to 8c per share in fiscal 2016.