Industry News - PM

Cereal maker to acquire Bob Evans Farms


By Susan Kelly on 9/19/2017

Cereal maker Post Holdings announced it will acquire Bob Evans Farms Inc. in a $1.5 billion deal to gain a presence in the breakfast sausage category and strengthen its position overall in the higher-growth packaged foods market.

The acquisition of Bob Evans gives Post a complementary portfolio of brands, including a leading brand in refrigerated side dishes, strengthens its position in both refrigerated retail and foodservice channels, and increases its presence in the higher-growth perimeter of the store, Post said. It will pay $77 per share for Bob Evans.

Founded in 1948, Bob Evans is a leading producer and distributor of refrigerated potato, pasta and vegetable-based side dishes, pork sausage, and a variety of refrigerated and frozen convenience food items under the Bob Evans, Owens, Country Creek and Pineland Farms brands.

Bob Evans also has a growing foodservice business, representing approximately 35 percent  of volume. The foodservice business sells a range of products, including sausage, sausage gravy, breakfast sandwiches and side dishes, which are made to match individual customer specifications.

“We have enormous respect for Bob Evans’ success and are excited about the growth opportunities this combination will create,” said Rob Vitale, President and Chief Executive Officer of Post Holdings.

The transaction, which was approved by the boards of directors of both companies, is expected to be completed in the first calendar quarter of 2018.

Upon closing of the acquisition, Post expects to combine its existing refrigerated retail egg, potato and cheese business with Bob Evans, establishing a refrigerated retail business within Post, which will be led by Mike Townsley, Bob Evans’ current president and CEO. Jim Dwyer will continue in his current role as president and CEO of the Michael Foods Group, managing the commercial foodservice egg, potato and pasta businesses, which will include the Bob Evans foodservice business.

 


 
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