TreeHouse Foods has agreed with Post Holdings to terminate the deal to sell its ready-to-eat cereal business to Post.
The decision follows a complaint filed by the Federal Trade Commission (FTC) last month opposing the deal.
According to the FCC, the acquisition, which was announced last May, would have given Post “more than a 60% share” in the US private label ready-to-eat cereal market.
“Households nationwide benefit from the robust competition between Post and TreeHouse, and a merger between these companies would likely lead to higher prices and reduced quality of the store-brand cereals that consumers enjoy today,” said Ian Conner, deputy director of the FTC’s Bureau of Competition.
In a statement released yesterday, TreeHouse Foods CEO Steve Oakland said: “After thoroughly evaluating our options and the potential outcomes, our board has determined that terminating the agreement with Post and immediately seeking another buyer for the business is the proper course forward.
“Unfortunately, the business risk, necessary resources and extent of time required to challenge the FTC’s position was not in the best interest of our constituencies.”
The cereal business was acquired by TreeHouse Foods from Conagra Brands as part of the Private Brands transaction in 2016. The business operates two manufacturing plants in Lancaster, Ohio and Sparks, Nevada.
TreeHouse said it will begin the process of remarketing the business for sale.
© FoodBev Media Ltd 2020