Dressing up a salad deal at US$580m
Print Edition
Pinnacle Foods is buying Wish-Bone salad dressings from Unilever for US$580 million.
Combined annual sales, which include the liquid and dry-mix salad dressings under the Wish-Bone and Western brands, total about US$190 million.
“The transaction enhances our ability to offer consumers meal solutions and recipe ideas across our broad portfolio of brands,” Pinnacle Foods CEO Bob Gamgort said in a statement yesterday.
Pinnacle Foods Inc, based in Parsippany, New Jersey, went public in March. Its other products include Vlasic pickles, Duncan Hines frosting and cake mixes and Birds Eye frozen foods.
Pinnacle Foods will pay for the deal with available cash and new debt. It anticipates around US$125 million in tax benefits.
Unilever Plc will continue to produce the brands for an undetermined period of time under a third-party manufacturing agreement. Unilever said that this production will occur at its Independence, Missouri, plant, which is not included in the deal.
Pinnacle Foods plans to invest US$40 million to US$50 million to consolidate production at one of its existing plants.
The buyout is set to close late in the third quarter or early in the fourth quarter. It may add slightly to Pinnacle Foods’ 2013 earnings per share, becoming more meaningful starting in 2014.
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