ConAgra Foods Inc. (CAG) agreed to acquire Del Monte Canada Inc.
from an affiliate of private equity firm Sun Capital Partners Inc.,
as the packaged food company looks to grow its core businesses and
improve its international presence.
Financial terms weren't disclosed. The deal includes the
acquisition of all Del Monte branded packaged fruit, fruit snacks
and vegatable products in Canada as well as Aylmer tomato
products.
Chief Executive Gary Rodkin said the deal will also help the
company grow its position in North American tomato products, expand
its vegetable product line and add packaged fruit and fruit snacks
to its portfolio.
Del Monte Canada had about $150 million in revenue in fiscal
2011.
ConAgra is hoping to make a bigger splash in the private-label
arena, where it sees more growth potential. After failing to
acquire Ralcorp Holdings Inc. (RAH), a large private-label company
that makes ready-to-eat food and snacks, ConAgra is hunting for
acquisitions in the space. It recently bought a private-label
pretzel maker for $300 million.
Last month, ConAgra said fiscal second-quarter earnings fell 14%
after being hit with hedging losses, and said its consumer-foods
unit was hurt by rising commodities costs.
Shares rose by 9 cents to $26.94 in recent trading. The stock is
up 17% in the past 12 months.
-By Nathalie Tadena, Dow Jones Newswires; 212-416-3287; nathalie.tadena@dowjones.com