TreeHouse Foods has agreed to sell its Soup and Infant Feeding (SIF) business to Riverbend Foods, a newly founded portfolio company of Insight Equity.
The SIF business is based in Pittsburgh, Pa. and is a leading manufacturer of private label condensed and ready-to-serve soup, baby food and gravy packaged in cans, glass jars and Tetra Recart formats. Sales of the business were approximately $210 million in 2016.
The transaction will have a negligible impact on the ongoing operating income of TreeHouse Foods. Financial terms of the sale were not disclosed. The transaction is subject to customary closing conditions and is expected to close in the second or third quarter of 2017.
Sam K. Reed, Chairman and CEO of TreeHouse Foods said: "As we continue to deliver on our promise of transformation and shareholder value creation, it is important that we focus our portfolio and enhance our approach toward resource allocation.
"This strategic transaction allows us to simplify our business and concentrate our efforts toward more dynamic categories that support our customers' corporate brand initiatives while offering consumers the best balance of both quality and cost."
Jack Waterstreet, Partner at Insight Equity said: "The acquisition of Soup and Infant Feeding presents a unique opportunity to acquire a food manufacturing platform with numerous attractive growth opportunities.
"We believe the business has opportunities in its existing categories as well as attractive adjacent categories, and we are delighted to welcome the Soup and Infant Feeding business to our portfolio."
TreeHouse Foods acquired the Soup and Infant Feeding business and the Pittsburgh facility from Del Monte Foods, Inc. in 2006. Approximately 400 hourly and 60 salaried employees will transition from TreeHouse Foods to Riverbend.
TreeHouse Foods will retain its Tetra aseptic carton business, which includes broth and other products that are produced in another location.
Both TreeHouse Foods and Insight Equity are committed to a smooth transition for employees, customers and consumers.
Harris Williams & Co. served as financial advisor and Winston & Strawn as legal advisor for TreeHouse Foods. Hunton & Williams LLP served as legal advisor to Insight Equity.
