Blog: Diamond looking to strike gold with Pringles buy
Dean Best | 5 April 2011
Pringles has, for some time, seemed to be the odd one out in a Procter & Gamble portfolio that includes brands like Gillette razors, Bold fabric conditioner and Duracell batteries.
And Diamond Foods has, on occasion, been linked to a move for Pringles. Last autumn, there were reports that P&G had turned down a deal with Diamond, with the consumer goods giant said to be dissatisfied with the way the US snacks maker had outlined a potential transaction.
The announcement of a US$2.35bn deal today (5 April) marks P&G's exit from the food sector and sees Pringles join a Diamond stable that has, for the last year, been home to upmarket crisp business Kettle Chips.
The proposed deal - subject to the approval of, among other things, Diamond's investors - looks to be a significant move by the company.
Bringing Pringles into its stable will more than triple the size of its snacks business, more than double its sales in its two key markets - the US and the UK - and mean that the States only accounts for 51% of its total revenues.
And, as Diamond told analysts today on a conference call to discuss the transaction, the company plans to use Pringles distribution network to expand the presence of some of its existing brands.
What do the likes of PepsiCo make of this deal?
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