Hillshire Brands Co. said Monday it is buying
The Chicago company, the maker of products including Ball Park franks and Jimmy Dean sausage links, said the acquisition will increase its presence in the center aisles, refrigerators and freezer cases of grocery stores.
Pinnacle's list of brands also includes Vlasic pickles, Wish-Bone salad dressings and Birds Eye frozen foods.
"The combination of Hillshire Brands and Pinnacle Foods brings together two highly complementary organizations with strong brands, skilled employees and lean cost structures," Hillshire Chief Executive Sean Connolly said in a Monday statement. "
The cash-and-stock transaction will include Pinnacle's outstanding net debt. For every Pinnacle share, stockholders will receive half a share of Hillshire common stock and $18 in cash.
This is Hillshire's third acquisition in the last year as Connolly works to move the company beyond its reliance on meats. Last month, Hillshire said it was buying Van's Natural Foods, the maker of such healthy fare such as whole-grain waffles and gluten-free pancakes.
Hillshire is expected to save about $140 million in costs within three years of acquiring Pinnacle. On Monday, the company said it plans to maintain its current annual dividend of 70 cents a share.
The deal, which is subject to shareholder and regulatory approval, is expected to close by September.