Snyder's-Lance, Inc. announced a definitive agreement has been signed to sell Private Brands along with two manufacturing facilities in the U.S. and Canada to Shearer's Foods, LLC, a leading provider of private label snacks headquartered in Massillon, Ohio. The agreed upon sales price is $430 million. Consistent with the Snyder's-Lance strategic plan, this transaction will allow Snyder's-Lance to focus entirely on its branded products by placing more resources to work on growth categories such as "better for you," nutritional and premium snacks. These growth platforms will benefit from incremental product development, innovation, marketing and one of the largest Direct Store Delivery (DSD) networks in the U.S., according to the release.
"This transaction is an important step forward for Snyder's-Lance as we dedicate our attention to our branded portfolio," said Carl E. Lee, Jr., president and chief executive officer, in a prepared statement. "Over the past several years, we have been building operational and branded capabilities which provide an exceptional platform for accelerating growth. Private Brands has performed well over that time and is now in a position where a new, private brands centric owner can build on this momentum and take it to new levels. Looking forward for Snyder's-Lance, we believe focusing more completely on our branded products will create better long term shareholder value as we grow organically through product innovation and the acquisition of additional core brands. We'll continue to leverage our strong national DSD network, fast growing Direct Sales team, excellent marketing and brand building as well as our strong balance sheet. I want to especially thank all of our associates who have worked to make our Private Brands successful for many years, and wish everyone the greatest of success in the future. The operating philosophies of Shearer's are very similar to Snyder's-Lance, and we feel we have found a great home with excellent potential for our people."
Completion of the transaction is subject to regulatory approvals and Shearer's obtaining financing for the transaction as well as customary closing conditions and is expected to close in the second quarter of 2014.
BofA Merrill Lynch acted as transaction advisor to Snyder's-Lance and K&L Gates LLP acted as legal counsel.