Del Monte Pacific to buy U.S. Food Brands for $1.68 Billion
The deal between the two unaffiliated companies gives the Asian firm rights to the Del Monte, Contadina, S&W and College Inn food brands in the U.S., the San Francisco-based company said in a statement today. The Philippine company already has licenses for some of the brands in parts of Asia.
Del Monte Pacific is seeking to expand into the U.S., where consumer spending rose in August for a fourth consecutive month. The deal gives it canned fruit, vegetable and broth brands as part of a business that counts Wal-Mart Stores Inc. (WMT) among its customers. The lines generate annual sales of about $1.8 billion, according to the statement. “The U.S. was one of few key markets where our company did not have a direct presence nor have its own brands.” Del Monte Pacific Chairman Rolando Gapud said in a statement today.
Del Monte Pacific also operates pineapple plantations and will benefit from expanding into the processed food business in the U.S., it said in a statement today. It has been a supplier of processed pineapple to Del Monte Foods.
The transaction is subject to regulatory approvals and customary closing conditions and is expected to close early next year. Perella Weinberg Partners LP served as lead financial adviser and Citibank as a financial adviser to Del Monte Pacific.
Source: bloomberg.com
