Post Holdings, Inc. entered into a definitive agreement to acquire Pet Food Business of Ainsworth Pet Nutrition, LLC and Big Heart Pet Brands, Inc. for $1.2 billion.
February 07, 2023
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Post Holdings, Inc. (NYSE:POST) entered into a definitive agreement to acquire Pet Food Business of Ainsworth Pet Nutrition, LLC and Big Heart Pet Brands, Inc. for $1.2 billion on February 8, 2023. Post will acquire the Pet Food Business for $1.2 billion on a cash-free, debt-free basis, subject to an inventory adjustment. Under the terms of the agreement, at closing Post will pay $700 million in cash and issue to The J.M. Smucker Co. approximately $500 million of new shares of Post common stock (approximately 5.4 million new shares of Post common stock). Post expects to fund the cash portion of the purchase price with a combination of cash on hand and through borrowings under its existing revolving credit facility i.e. purchase was funded with cash on hand, certain proceeds from the previously announced incremental term loan facility and approximately 5.4 million new shares of Post common stock issued to The J.M. Smucker Co. The transaction includes leading dog and cat food brands such as Rachael Ray® Nutrish®, Natureâs Recipe®, 9Lives®, Kibbles ân Bits® and Gravy Train® (the âPet Food Brandsâ). Post also is acquiring manufacturing and distribution facilities in Bloomsburg, Pennsylvania and manufacturing facilities in Meadville, Pennsylvania and Lawrence, Kansas (such facilities together with the Pet Food Brands, the âPet Food Businessâ). Upon closing of the acquisition, Post expects to create a new pet food platform within Post Consumer Brands. The Pet Food business generated net sales of $1.4 billion in the year ended April 30, 2022. As part of the agreement, over 1,000 people will join Post. Nicolas Catoggio will continue in his current role as President and Chief Executive Officer of Post Consumer Brands.
The transaction is subject to closing conditions, including the expiration of waiting periods under United States antitrust laws and approval for listing. The transaction is expected to be completed early in the second calendar quarter of 2023. As of February 28, 2023, the transaction is expected to close during the fourth quarter of 2023. The transaction is expected to be immediately accretive to Postâs free cash flow*, excluding one-time transaction expenses.
Barclays Capital Inc. and Evercore are acting as financial advisors to Post. Goldman Sachs & Co., LLC acted as financial advisor and Steven A. Rosenblum and Ronald C. Chen of Wachtell, Lipton, Rosen & Katz acted as legal advisors to The J. M. Smucker Company. Tom W. Zook and Alfred J. Ludwig of Lewis Rice LLC acted as the legal advisor to Post Holdings.
Post Holdings, Inc. is a consumer-packaged goods holding company. The Company operates through four segments: Post Consumer Brands, Weetabix, Foodservice and Refrigerated Retail. Post Consumer Brands segment includes North American ready-to-eat (RTE) cereal and Peter Pan nut butter. Weetabix segment includes primarily the United Kingdom (the U.K.) RTE cereal, muesli and protein-based ready-to-drink shakes. The Foodservice segment sells primarily egg and potato products. The Refrigerated Retail segment primarily sells side dishes, egg, cheese and sausage products. The Company also operates a pet food business, which includes the brands, such as Rachael Ray, Nutrish, Natureâs Recipe, 9Lives, Kibbles ân Bits and Gravy Train. This business also includes private-label pet food assets and manufacturing and distribution facilities. The Company also includes two manufacturing and warehousing facilities in Visalia, California.
Post Holdings, Inc. entered into a definitive agreement to acquire Pet Food Business of Ainsworth Pet Nutrition, LLC and Big Heart Pet Brands, Inc. for $1.2 billion.