US/UK: Diamond Foods to buy crisp maker Kettle
United Biscuits was among the rumoured bidders for Kettle
US snack firm Diamond Foods is to buy upmarket crisp maker Kettle Foods from private-equity firm Lion Capital for US$615m.
Diamond, which makes a range of nuts products, has beat off several interested parties for Kettle, which has operations in both the US and the UK.
The company has struck a deal to buy the operations on both sides of the Atlantic. Chairman, president and CEO Michael Mendes said Kettle was a "strong, strategic fit" to the business.
"We have taken a very deliberate approach toward screening possible acquisitions, focused on premium brands with growth potential that have synergy with the customer segments we already serve," Mendes said.
"We believe Kettle Foods is a strong fit with the capability to provide solid financial returns for our shareholders, and we plan to invest behind the brand in several areas to position it for long-term success."
London-based Lion Capital bought Kettle in 2006. Partner Lyndon Lea claimed Kettle's sales and earnings had jumped under private-equity ownership.
"We have dramatically increased Kettle's strategic value through category-leading innovation and penetration gains in the US and UK snacking markets, leading to double-digit annualised growth in group revenues and 30% annualized growth in group profitability," Lea said.
Diamond said it expects to close the deal by the end of its fiscal year, which finishes in July.
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