US food giant Kraft Foods has announced that it is to acquire the Back to Nature cereal and granola business from privately-held Organic Milling.

The Back to Nature brand, which is sold in retail grocery and natural product stores in the US, registered sales of almost US$10m in 2002.

Kraft said Organic Milling will produce Back to Nature cereals and granola for Kraft under a co-manufacturing agreement.

Financial terms of the agreement were not disclosed.