Jan 24, 2007
B&G Foods Acquires Cream of Wheat Brand From Kraft
PARSIPPANY, N.J. -- B&G Foods, Inc. here, said yesterday that a newly formed subsidiary of the company would acquire the Cream of Wheat and Cream of Rice hot cereal brands from Northfield, Ill.-based Kraft Foods Global, Inc. for about $200 million in cash.
Noted B&G Foods c.e.o. David L. Wenner in a statement: "Cream of Wheat is a strong brand name in the growing hot cereal category, and a brand that we think will do well within B&G Foods. This acquisition is very consistent with our strategy of acquiring smaller, higher-margin brands. We expect the acquisition to improve the already healthy margin structure of B&G Foods and to be accretive to our company's free cash flow. This is yet another example of B&G Foods' ability to grow dynamically through acquisition."
"Our decision to sell Cream of Wheat is part of a broader effort at Kraft to focus our portfolio," said Rick Searer, president, Kraft North America Commercial. "The divestiture allows us to focus our resources on businesses that offer potential long-term competitive advantages for us, creating value for Kraft shareholders, while providing B&G Foods with a great business."
Introduced in 1893, Cream of Wheat is one of top hot cereal brands in the United States. The Cream of Wheat and Cream of Rice brands together yielded net sales of about $60 million last year.
B&G Foods said that it expects to pay for the acquisition with additional debt, and to complete this transaction, the company has received financing commitments for senior secured debt financing from Lehman Brothers, Inc. and Credit Suisse in an amount sufficient to fund the purchase price.
Under the terms of the acquisition agreement, B&G Foods will also buy certain manufacturing equipment. The company expects the deal to close in the first quarter of fiscal 2007, subject to regulatory approval and the satisfaction of customary closing conditions.
B&G Foods' brands include Ac'cent, B&G, B&M, Brer Rabbit, Emeril's, Grandma's Molasses, Joan of Arc, Las Palmas, Maple Grove Farms of Vermont, Ortega, Polaner, Red Devil, Regina, San Del, Trappey's, Underwood, Vermont Maid, and Wright's.
Kraft offer such products as Kraft cheeses, dinners, and dressings; Oscar Mayer meats, DiGiorno pizzas, Oreo cookies, Ritz crackers and chips, Philadelphia cream cheese, Milka and Cote d'Or chocolates, Planters nuts, Honey Bunches of Oats cereals, Jacobs, Gevalia, and Maxwell House coffees; Capri Sun, Crystal Light, and Tang beverages; and a line of South Beach Diet and better-for-you Sensible Solution items.
570 Lake Cook Rd, Suite 310
Deerfield IL 60015
Convenience Store News
CSNews Supplier Guide
CSNews for the Single Store Owner
Private Label ⇒ Store Brands
Independent Grocer Network
The Gourmet Retailer
Directory of Convenience Stores
Hispanic Retail 360
|© 2014 Stagnito Media. All rights reserved.|