US protein behemoth Tyson Foods has signed a definitive agreement to sell its Specialty Brands subsidiary to Fremont Partners, a San Francisco based private equity firm.
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Specialty Brands is a producer, processor and marketer of frozen food products, under brand names that include Jose Ole, Rotanelli, Posada, Little Juan and Butcher Boy. Specialty Brands has manufacturing sites in New York, Missouri, Texas, New Mexico, and California, and is headquartered in Ontario, California. With about 1,650 employees, the firm had sales of about US$300m in fiscal year 2001.
John Tyson, chairman and CEO of the Springdale, Ark.-based firm, explained, “The divestiture of Specialty Brands is a part of the on-going process of evaluating our businesses in relation to our protein based business model.
“We will continue this process in order to expand our position and improve our profitability. I continue to be pleased with the progress we’ve made on paying down debt and the flexibility this gives us. Specialty is a great company that didn’t fit our business model. The management and team members will do a great job for Fremont.”
Terms of the transaction were not disclosed. Subject to potential purchase price adjustments at closing, the sale is expected to result in a pre-tax gain of up to US$25m. Closing is contingent on customary closing conditions, including approval under the Hart- Scott-Rodino Antitrust Improvements Act.
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