Campbell Soup Company has entered into an agreement to acquire Sovos Brands for $23 per share in cash, representing a total enterprise value of approximately $2.7 billion.
Sovos Brands’s portfolio includes products such as pasta sauces, dry pasta, soups, frozen entrées, frozen pizza and yogurts under the brand names Rao’s, Michael Angelo’s and Noosa.
The acquisition will add a “high-growth, market-leading premium portfolio” of brands to Campbell’s meals and beverages division.
Campbell’s president and CEO, Mark Clouse, said: “We’re thrilled to add the most compelling growth story in the food industry and welcome the talented employees who have built a nearly $1 billion portfolio”.
He added: “This acquisition fits perfectly with and accelerates our strategy of focusing on one geography, two divisions and select key categories that we know well. Our focused strategy has enabled us to deliver strong results over the last five years, enhance our brands and capabilities, and generate strong cash flow to lower debt.
“With all this progress, I am confident in our readiness to execute and integrate this important acquisition. The Sovos Brands portfolio strengthens and diversifies our meals and beverages division and paired with our faster-growing and differentiated snacks division, makes Campbell one of the most dependable, growth-oriented names in food.”
Todd Lachman, founder, president and chief executive officer of Sovos Brands, commented: “We have built a one-of-a-kind, high growth food company focused on taste-led products across a portfolio of premium brands, anchored by the Rao’s brand. As one of the most trusted and respected food companies in North America, I’m confident in Campbell’s ability to continue bringing our products to more households and further building on our track record of growth and success for years to come.”
Campbell plans to finance the acquisition price through the issuance of new debt. The closing of the transaction is subject to Sovos Brands stockholder approval and customary closing conditions, including regulatory approvals. Closing is expected by the end of December 2023.
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