Lasorda Foods to Merge With Denver Firm

In an effort to make a score in the food industry, Lasorda Foods Inc.--the spaghetti sauce maker part-owned by Dodger manager Tommy Lasorda--agreed Tuesday to become a wholly owned subsidiary of Discovery Capital Corp. of Denver.

The transaction is expected to pump up to $4 million into Irvine-based Lasorda Foods over the next year, which company officials said would be used to expand its product line, including adding dry pasta, frozen pizza and Italian salad dressing.

The proposed merger--technically a share exchange outlined in a letter of intent--involves swapping 100% of the issued and outstanding shares of Lasorda Foods for about 85% of the common shares of Discovery Capital.

The transaction is expected to be completed by Dec. 1, said Discovery attorney Bob Merrill.

Lasorda, the Dodgers’ voluble pasta expert, owns 10% of Lasorda Foods, and he and his wife, Jo, have endorsed its products in public appearances. Early next year he will be featured in television and radio commercials pitching its Italian food products. Lasorda Foods was formed 15 months ago and this month began shipping its tomato-based sauce to all the major Southland grocery chains. In March, the company moved its headquarters to Orange County, where a staff of six is employed.

The amount of money that Discovery Capital, a fledgling venture capital fund whose stock is traded over the counter in the “pink sheets” market, will invest in Lasorda Foods ultimately depends on whether two classes of outstanding warrants are exercised as part of the deal.

“With the name recognition and promotion behind Lasorda Foods, everybody’s expectation is that (the company) will hit a home run,” and the warrants exercised, said Merrill.