“The acquisition creates a leading branded food company with enhanced scale, reach and capabilities while providing margin expansion and strong EPS accretion,” said Sean Connolly, president and CEO of Hillshire Brands. “The new Hillshire Brands will have a strengthened position in frozen foods, new opportunities in the center store for our brands and in refrigerated for Pinnacle Foods’ brands. We believe our increased scale combined with a more diversified portfolio will deliver strong, consistent cash flows. This will enable us to continue to invest in our brands, enhance our portfolio, pursue value accretive M&A and deliver significant long-term value to our shareholders.”
Hillshire Brands has also signed an agreement to acquire Van’s Natural Foods from private equity firm Catterton Partners for $165 million. Van’s is a better-for-you food brand that is expected to have net revenues of approximately $60 million in calendar year 2014. “The Van’s brand is a terrific addition to our portfolio,” said Mr. Connolly. “Not only does it expand our presence in the frozen category, it also gives us a proven health and wellness brand with extendability beyond frozen.”
Based in Phoenix, AZ , Van’s Natural Foods will become part of Hillshire Brands’ Retail segment, pairing with brands such as Jimmy Dean, Hillshire Farm and Ball Park. Van’s management will continue to lead the business. Van’s is a simple/clean ingredient food brand in frozen breakfast and snack foods including waffles, pancakes, cereal, crackers and snack bars. Van’s frozen breakfast and snack foods are available at grocery stores, mass merchandise stores and natural food retailers nationwide.