US nut maker Diamond Foods has entered into a definitive agreement to acquire the Pop Secret popcorn business from General Mills.
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The deal, worth around US$190m in cash, is expected to add annual sales of $85m to $90m to Diamond’s earnings.
Michael J. Mendes, president and CEO of Diamond Foods, said: “We are very excited about the addition of Pop Secret to our snack portfolio. It will significantly broaden our presence in the snack aisle and increase promotional efficiency, while leveraging our existing supply chain and corporate infrastructure.”
Pop Secret is the second largest brand in the microwave popcorn category and commands a 25% share in US grocery stores.
“We have taken a very deliberate approach towards screening potential acquisitions by focusing on premium brands that are targeted towards customer segments we currently serve and provide solid financial returns for our shareholders. Pop Secret fits our acquisition criteria, and we plan to invest behind the brand to position it for long-term success,” Mendes added.
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By GlobalDataThe purchase will be funded, in part, with the proceeds from a new five year $250m credit facility. Subject to regulatory approval, the purchase is expected to close in the autumn.
