Hormel acquires Columbus Manufacturing for $850 million
The company announced that this is a strategic acquisition which makes itself a total deli solutions provider and enhances its other strong deli brands such as Hormel, Jennie-O, Applegate, and Di Lusso, according to a media release.
“We are pleased to add Columbus to the Hormel Foods family. Columbus has an outstanding reputation in the food industry and is well-positioned in the advantaged retail deli category,” said Jim Snee, president and chief executive officer at Hormel Foods. “Columbus is capitalizing on one of the fastest-growing areas in the retail grocery store with premium, authentic products that are on-trend with today’s consumers who are looking for unique experiences, flavors, and products.”
“The acquisition of Columbus will serve as a catalyst for uniting all our deli businesses into one customer-facing organization,” Snee said. “This acquisition significantly enhances our scale in the deli by broadening our portfolio of products, customers, and consumers. The synergies we can unlock with this acquisition are clear and I’m excited for the next evolution of our company.”
“As a millennial-focused brand, Columbus has generated category-leading growth through a passionate commitment to quality, simplicity, and time-honored recipes,” said Joe Ennen, chief executive officer of Columbus Manufacturing, Inc. “In Hormel we are joining an organization whose values and culture perfectly align with our
own.”
Hormel Foods expects this acquisition to be modestly accretive to earnings per share in fiscal 2018. Full-year accretion in fiscal 2019 is expected to be between 6 to 8 cents per share.
The company will continue to operate from California and will report into the Refrigerated Foods segment. The transaction is subject to customary closing conditions, including the receipt of regulatory approvals in the United States. Hormel Foods was advised by Barclays and Faegre Baker Daniels LLP. Columbus Manufacturing was advised by BofA Merrill Lynch and DLA Piper LLP (US). In addition, Rothschild provided financial advice to Columbus Manufacturing.
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