The Minnesota-based maker of private label macaroni and cheese, skillet dinners and other value-added side dishes and salads sells primarily to the North American retail grocery segment and has sales of approximately $100m.
TreeHouse has agreed to pay $180m in cash for the business, subject to certain closing and post-closing adjustments, plus up to an additional $15m in cash if the company achieves certain earnings targets for the 12-month period ending 31 December 2010.
The acquisition will be financed through borrowings under TreeHouse’s existing $600m credit facility. The transaction will be neutral to the company’s earnings over the balance of 2010, but is expected to add between $0.11 and $0.13 per share to earnings on an annualised basis.
The acquisition is expected to close in October subject to regulatory approvals and the satisfaction of customary closing conditions. TreeHouse doesn’t anticipate making any significant changes to ST’s existing operations.
Source: TreeHouse Foods
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