Hillshire Brands Acquires Pinnacle Foods

On Monday, The Hillshire Brands Company HSH and Pinnacle Foods Inc. PF announced that they have an entered an agreement for Hillshire Brands to acquire all shares of Pinnacle Foods in a cash and stock transaction.

This acquisition was unanimously approved by the board of directors from both companies and is expected to close by September 2014. The combined company will be led by Hillshire President and CEO Sean Connolly and have annual net revenues of approximately $6.6 billion. Hillshire’s press release states, “The transaction brings together two highly complementary businesses with leading, iconic brands to create a diversified food company with estimated pro forma 2014 sales of $6.6 billion. On a combined basis, the companies will have leading positions in key frozen, refrigerated and center of store grocery categories.”

According to Pinnacle’s press release, Pinnacle stockholders will receive $18.00 per each share of Pinnacle stock held, in addition to 0.50 Hillshire shares. This transaction represents an approximate 80 percent premium from Pinnacle’s IPO on March 28, 2013, and an 18 percent premium to Pinnacle’s stock price on May 9, 2014.

Affiliates of Blackstone, which holds close to 51 percent on Pinnacle’s common stock, agreed to vote their shares in favor of the transaction. Hillshire will appoint a representative from Blackstone to its board of directors.

CEO of Pinnacle Foods Bob Gamgort commented, “This compelling transaction offers Pinnacle Foods shareholders an immediate premium and the opportunity to participate in the tremendous potential of the combined organization. The complementary portfolios and strategic fit of these two companies create significant value for the shareholders of both organizations. Our common passion for developing innovative products and maintaining close ties with our customers will position the combined entity to deliver outstanding benefits for employees, customers and shareholders.”

Posted In: NewsFinancingContractsManagementM&AHillshire Brands Acquires Pinnacle Foods
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