Campbell's taps into fast-growing snack space
28 Mar 2018 --- Campbell Soup Company recently announced the completion of the acquisition of Snyder’s-Lance, Inc. for US$50 per share in an all-cash transaction. The acquisition, which represents an enterprise value of approximately $6.1 billion, is a strategic acquisition for Campbell, creating a US$10 billion company with almost half of annual net sales in the fast-growing snacking category, called Campbell’s Snacks.
Denise Morrison, Campbell’s President and Chief Executive Officer, said: “The combination of Campbell and Snyder's-Lance creates a unique, diversified snacking portfolio of differentiated brands and a large variety of better-for-you snacks for consumers. I am excited about the combination and confident that it will create significant shareholder value through both revenue growth and cost synergies.”
To unlock the power of the combined brand portfolio, Campbell is integrating the Pepperidge Farm and Snyder’s-Lance portfolios to create a unified snacking organization in the US called Campbell Snacks. The unit will be led by Carlos Abrams-Rivera, former President, US Biscuits and Snacks, who will report to Luca Mignini, President, Global Biscuits and Snacks.
“We carefully selected leaders from Campbell and Snyder's-Lance to form the Campbell Snacks leadership team based on their expertise and understanding of how to leverage both businesses to support growth and profitability,” said Abrams-Rivera. “The Campbell Snacks team will focus on optimizing the value of our US snacks business to deepen our partnership with customers through the power of the combined portfolio.”
Campbell’s new diversified snacking portfolio enables the company to offer real food options to millions of families globally who enjoy eating occasions throughout each day. The Campbell Snacks portfolio will feature Pepperidge Farm’s iconic brands, including Goldfish and Milano, along with Snyder’s-Lance’s well-known brands, such as Snyder’s of Hanover, Kettle chips and Snack Factory Pretzel Crisps.
Campbell's global baked snacks product portfolio, including its Pepperidge Farm, Arnott’s and Kelsen businesses, generated approximately US$2.5 billion in net sales in the fiscal year 2017. With the addition of Snyder’s-Lance, snacking will now represent approximately 47 percent of Campbell’s annual net sales (previously 32 percent). Campbell’s soup portfolio will represent approximately 26 percent of the company’s annual net sales.
Campbell expects to achieve approximately US$170 million in cost synergies by the end of fiscal 2022. Additionally, Campbell expects to achieve approximately US$125 million of Snyder’s-Lance’s existing cost transformation program.
Snyder’s-Lance reported US$2.2 billion in net sales for the year ended Dec. 30, 2017.
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