TreeHouse Foods to Sell Meal Preparation Business
TreeHouse Foods is selling “a significant portion” of its Meal Preparation business to Investindustrial. The deal is valued at $950 million.
"Today's announcement reflects the board of director's unanimous determination that divesting a significant portion of the meal preparation business will deliver greater value for our shareholders than continuing to operate the divested businesses within TreeHouse," said Ann M. Sardini, chair of the board. "This transaction enables us to simplify our business and thus improve operational execution, further enhancing our ability to accelerate growth through category depth in our higher growth and margin Snacking and Beverages business."
Steve Oakland, president and CEO of TreeHouse Foods, added the positive demand trends for private label products are clear and simplifying the company’s business will better position it to capitalize on current trends to drive value now and into the future.
[Read more: "Which Private-Brand Products Are Gaining Momentum?"]
“This transaction strengthens our balance sheet, improves execution consistency and accelerates our ability to invest across snacking and beverage categories that present attractive growth opportunities,” Oakland said. “Our continued focus on commercial and operational excellence, people and talent, and driving simplification and growth that have been the hallmarks of our successful efforts to transform TreeHouse will remain as we continue our evolution in line with our strategy."
The transaction consists of approximately $530 million in cash at closing and approximately $420 million in senior secured debt to be provided by TreeHouse. The categories to be divested include the following: pasta, pourable and spoonable dressing, preserves, red sauces, syrup, dry blends and baking, dry dinners, pie filling, pita chips and other sauces.
The transaction is expected to close in the fourth quarter of 2022 and is subject to customary closing conditions and regulatory approvals.
