Post Holdings is to buy the shares in fellow US manufacturer 8th Avenue Food & Provisions that it does not own for $880m.
8th Avenue was formed in 2018 when Post brought together its private-label businesses in a transaction capitalised by private-equity firm Thomas H. Lee Partners.
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In 2021, 8th Avenue snapped up the Ronzoni pasta brand from Spain’s Ebro Foods.
The manufacturer’s products include branded and private-label pasta, as well as private-label nut butters and granola.
In a statement, Post said yesterday (3 June) the transaction includes the extinguishment of 8th Avenue’s outstanding net debt and the assumption of $111m in finance leases.
Rob Vitale, president and CEO at Post, said: “With this acquisition, we further our strategy of tactical private-label positioning alongside leading brands.
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By GlobalDataAround 1,580 employees will join Post. Through the acquisition, Post will bring in the manufacturing of its Peter Pan peanut butters.
The transaction is anticipated to be concluded on 1 July. Post expects the 8th Avenue acquisition will contribute approximately $115m in adjusted EBITDA in the 12 months following the deal closing, excluding anticipated cost synergies.
These synergies are projected to reach an annual run-rate of around $15m by the end of Post’s 2026 fiscal year.
Post also updated its fiscal year 2025 adjusted EBITDA guidance to a range of $1.46bn to $1.5bn, up from its previous forecast of $1.43bn to $1.47bn.
In May, Post, which was recently linked with the possible acquisition of US food peer Lamb Weston, said it adjusted its approach to M&A.
Vitale flagged the prevailing common themes among food manufacturers of late, he also said that “uncertainty in the capital markets complicates M&A valuations”.
In April, the US food major announced the closure of two of its cereal manufacturing facilities in North America, pointing to a “declining” market for ready-to-eat cereals.
