updated - October 1, 2020 Thursday EDT
Pinnacle Foods Inc. has announced in a press release that it will be acquiring Boulder Brands, Inc. for approximately $710 million.
The acquisition will expand Pinnacle's presence in growing and complementary health and wellness categories.
Pinnacle said in the press release that the acquisition will help the company expand its presence in the natural and organic retail channel.
The company will gain access to Boulder Brands' portfolio of health and wellness brands, including Udi's and Glutino gluten-free products.
Pinnacle adds in the press release that the acquisition also provides them with a new growth platform in refrigerated foods as the company will have access to Boulder Brands' EVOL natural frozen meal offerings, and Smart Balance and Earth Balance refrigerated and shelf-stable spreads businesses.
Boulder Brands' products have consumer base that are younger than that of Pinnacle's current consumer average and are sold in both traditional and natural channels in the U.S.
Bob Gamgort, the CEO of Pinnacle, said in the press release that the company plans to "retain Boulder Brands' existing headquarters location."
"In addition to being a synergy-rich, accretive transaction with on-trend brands, the acquisition provides us with an important health and wellness talent pool in Boulder, Colorado," he said.
Dean Hollins, the chairman of Boulder Brands, adds in the press release that the acquisition provides their shareholders with "immediate substantial cash value."
"Together with Pinnacle Foods, Boulder Brands will have additional and stronger resources to drive our brands and deliver value to customers and consumers, while providing new opportunities for employees," he said.
Reuters adds that Pinnacle's acquisition of Boulder Brands is due to the increase of U.S. consumers turning health-conscious and snubbing processed foods.
The shift on consumer preference is pushing companies to add products that are perceived as healthier to their portfolios.
Reuters adds that Hormel Foods Corp. said in May that they are buying Applegate Farms LLC to meet consumers demand for antibiotic and hormone-free meat.
Campbell Soup Co. announced in June that they are acquiring Garden Fresh Gourmet, a company that makes organic salsa.
Under the terms of the agreement, Pinnacle would acquire all of the outstanding shares of Boulder Brands for $11 per share.
The transaction will be valued at a total of approximately $975 million, including approximately $265 million in debt.
Pinnacle said in the press release that they expect the transaction to be completed in the first quarter of 2016.
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