US food producer Campbell Soup Co (NYSE:CPB) said on Monday it had agreed to acquire sector player Bolthouse Farms from a fund managed by private equity firm Madison Dearborn Partners LLC for $1.55bn (€1.3bn) in cash.
With this takeover, Campbell will extend its V8 beverage business and will establish one of the industry’s biggest healthy beverage platforms, with some $1.2bn in annual sales, the buyer said. In addition, the company will get an opportunity for expansion with value-added products in healthy snacking.
Campbell intends to pay for the purchase using a mixture of short- and long-term borrowings. It expects to finalise the transaction in late summer 2012, after receiving the necessary regulatory nods. The buyer estimates that the acquisition will contribute between $0.05 and $0.07 per share to its adjusted net earnings in fiscal 2013, including the impact of purchase accounting and cancellation of the strategic share buyback plan.
California-based Bolthouse was founded in 1915 and operates as an integrated food and beverage firm with leading market positions in fresh carrots and super-premium beverages in the US. The company markets its carrots under the Bolthouse Farms, Earthbound Farms and Green Giant brands and its beverages and dressings under the Bolthouse Farms brand. It generated an adjusted EBITDA of $92m on sales of $689m in the fiscal year to 31 March 2012 with its 2,100 employees.
The buyer will operate Bolthouse as a separate subsidiary and will retain senior management team, including its president and CEO Jeff Dunn.
Morgan Stanley (NYSE:MS) and Davis Polk & Wardwell LLP consulted Campbell, while Credit Suisse Group AG (NYSE:CS), Goldman Sachs Group Inc (NYSE:GS) and Kirkland & Ellis LLP advised Bolthouse.