B&G Foods has signed an agreement to acquire the Grandma’s Molasses brand from Mott’s LLP, a Cadbury Schweppes Americas Beverages company, for US$30m in cash and certain assumed liabilities.
Grandma’s Molasses is the leading brand of premium-quality molasses sold in the US. It is offered in two distinct styles: Grandma’s Original Molasses and Grandma’s Robust Molasses. The products are distributed nationally and in all trade channels, with the majority of sales originating from the grocery, food service and mass merchandiser segments of the market.
David L. Wenner, CEO of B&G Foods, said: “We are very pleased to add Grandma’s Molasses to our portfolio of brands. Not only does it complement our existing product offerings, but it also leverages our manufacturing and distribution capabilities. This transaction reflects our ongoing commitment to acquiring strong brands with leading market positions and high and sustainable margins at attractive valuations.”
In connection with the signing of the purchase agreement, B&G Foods said it had entered into an amendment to its existing credit facility. The amendment, which is subject to the closing of the acquisition and other customary closing conditions, provides for, among other things, a new $25m term loan and a reduction in the existing revolving credit facility commitments from $30m to $25m.
B&G said it intends to use the proceeds of the term loan together with cash on hand to fund the acquisition and to pay related transaction fees and expenses.
The company expects the acquisition of the Grandma’s Molasses brand to close in January 2006, subject to the satisfaction of customary closing conditions.