Campbell Soup Co. will acquire Snyder’s-Lance next year in a push to strengthen its foothold in the booming U.S. snacking market.
Campbell will pay $50 in cash for each of the North Carolina-based company’s shares, representing a 27 percent premium to Snyder’s-Lance’s Dec. 13 closing stock price. The acquisition, approved by the governing boards of both companies, is subject to regulatory approvals.
Snyder's-Lance, which pulled in $2.2 billion over the year ending Sept. 30, produces pretzels, chips, popcorn and other snacks under brands including Snyder's of Hanover, Lance, Kettle, Cape Cod, Snack Factory, Pop Secret, Emerald and Late July. Between 2012 and 2016, the company experienced a compound annual growth rate of 11.5 percent.
Campbell’s annual net sales are expected to exceed $10 billion. The Camden, N.J.-based company owns Goldfish maker Pepperidge Farm, Danish baked goods manufacturer Kelsen and Australia-based Arnott’s, manufacturer of Tim Tams, in addition to soup and beverage brands.
Denise Morrison, Campbell's president and ceo, said Snyder’s-Lance’s brands will complement Campbell’s existing $2.5-billion snacking portfolio, creating a platform the companies project will earn $4.7 billion in net sales. Currently, Campbell’s snack business represents 31 percent of its annual sales, but with the addition of Snyder’s-Lance, it will occupy nearly half of its business, while soups and broths will represent 27 percent.
"This acquisition will dramatically transform Campbell, shifting our center of gravity and further diversifying our portfolio into the faster-growing snacking category,” she said. “We look forward to welcoming Snyder's-Lance's employees and their trusted family of leading brands to our company."
Brian Driscoll, president and ceo of Snyder's-Lance, agreed, noting the acquisition “maximizes value” for its shareholders. Financed through $6.2 billion of short- and long-term debt, it’s expected to save $170 million by the end of fiscal year 2022.
“The transaction also unlocks the value of our portfolio, reflecting the progress we have made planning and executing our transformation,” he said. “We are excited to join Campbell and to continue to provide great products to our consumers with an uncompromising focus on ingredients, quality and taste."
The Snyder’s acquisition marks Campbell’s sixth in five years. The company acquired beverage maker Bolthouse Farms in August 2012, organic baby food company Plum in June 2013, biscuit company Kelsen in August 2013, fresh salsa and hummus maker Garden Fresh Gourmet in June 2015 and organic broth and soup producer Pacific Foods in December 2017.