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Agri-food company Cerealto has agreed to sell its pasta business and related manufacturing assets in Spain to Portuguese food producer Cerealis, as the European private-label supplier sharpens its focus on higher-growth snacking and breakfast categories.

The transaction, which includes the company's pasta facility in Venta de Baños (Palencia), is subject to approval by Spain’s CNMC and Portugal’s AdC.

The divestment marks a portfolio pivot for Cerealto, which generates around €570 million in annual revenue and manufactures biscuits, cereals, snack bars and corn and rice cakes for major retailers and brand owners across Europe, the UK, the US and Mexico.

Cerealto's chief executive Bosco Fonts says the agreement forms part of Cerealto’s growth strategy, allowing the group to concentrate capital and management attention on global snack and breakfast categories, where it sees greater headroom for expansion.

"Our pasta business has been high-performing and value accretive, which has benefited from substantial capital investment in recent years," he noted. "We are pleased to have met a new operator who is a specialist in pasta and can continue developing the business, while retaining the employment and working conditions for our colleagues in the pasta business unit."

While the pasta unit has been profitable and has benefited from recent capital investment, Cerealto indicated that the business would be better positioned under a dedicated pasta operator.

For Cerealis, the acquisition strengthens its industrial footprint and scale in a category that remains structurally resilient in Europe despite pricing volatility in durum wheat over recent years.

The deal reflects a broader trend among mid-sized food manufacturers to streamline portfolios and double down on core capabilities, particularly in private label, where retailer consolidation and margin pressure are driving the need for operational focus and category specialism.

Cerealto says the transaction guarantees continuity of operations at the Venta de Baños site, with no anticipated changes to employment, working conditions or day-to-day activities. A transition phase will begin once regulatory approvals are secured.

For customers – primarily large retailers and branded food groups – operations will continue as normal until completion.

The company is backed by Davidson Kempner Capital Management and Afendis Capital Management.

Financial terms were not disclosed.