ConAgra acquires Ralcorp for $5 billion

November 27, 2012

According to Reuters, ConAgra Foods Inc. has acquired Ralcorp Holdings Inc. for $5 billion. This comes more than a year and a half after ConAgra first bided on the U.S. producer of store-branded foods. ConAgra said on Nov. 27 it will pay $90 per share in cash.

The deal creates a packaged food giant with $18 billion in annual sales—from branded foods like Slim Jim meat snacks and Hunt’s ketchup to foods that stores brand as their own. ConAgra Chief Executive Gary Rodkin began pursuing Ralcorp in March 2011 with an offer of $82 per share. After raising its bid twice, ConAgra walked away from its then-final offer of $94 per share, which valued Ralcorp at $5.2 billion.

Ralcorp is a top maker of private label cereal, pasta, crackers, jams and jellies, syrups, and frozen waffles—categories where ConAgra does not have a large presence. The deal also broadens ConAgra’s exposure to faster-growing retailers with private-label brands, like Whole Foods Market Inc. and Costco Wholesale Corp.

The companies expect the deal to close by March 31 and modestly benefit ConAgra's financial results for fiscal 2013.

Reuters article

Press release