Danone Signs an Agreement to Acquire YoCream
Hanna added, "We have continued our strong track record of innovation in this category and appreciate that Danone has recognized our leadership role for frozen yogurt in the foodservice industry."
24 Nov 2010 --- Danone has signed an agreement to acquire YoCream, the leading producer of frozen yogurt in the United States, for US$103 million.
The transaction will enable Danone to move into frozen yogurt, a fast growing segment in the US. It will also gain access to an away-from-home distribution network, in addition to its existing channels.
The move reflects Danone’s strategy for expansion of the fresh dairy products market in the US, in particular by extending the times and places where its products are consumed.
YoCream is based in Portland, Oregon, and its 2010 net sales are estimated at approximately US$58 million. The acquisition is subject to usual conditions for this type of transaction and is expected to be closed by the end of 2010.
YoCream International, Inc. said in a statement that the Board of Directors of YoCream, acting on the recommendation of a special committee comprised solely of independent directors, has unanimously approved the transaction and recommends that all YoCream shareholders vote their shares to approve the merger.
John Hanna will remain CEO and a director of YoCream following the closing of the transaction and the Company's senior management team will also remain. They, along with one former board member, will retain an ownership interest of approximately 5% in the Company following the closing. The name of the Company will remain YoCream International following the closing.
John Hanna, co-founder and chief executive officer of YoCream stated that, "The Company has been exploring various opportunities for continued growth for some time. This transaction benefits our shareholders by providing them with the opportunity to receive a significant premium for their YoCream shares, and joining the Danone Group represents a natural progression in our corporate achievement to provide healthful live and active cultured frozen yogurt to consumers in the US and abroad." Hanna added, "We have continued our strong track record of innovation in this category and appreciate that Danone has recognized our leadership role for frozen yogurt in the foodservice industry."
The purchase price is subject to adjustment depending on the amounts of YoCream's net indebtedness and net working capital at closing, and approximately 1.5% of the purchase price will be retained in escrow for up to 90 days to satisfy this adjustment and approximately 10% of the purchase price will be retained for up to two years to satisfy any post-closing indemnification claims.
YoCream expects the transaction to close before December 28, 2010. If the closing does not occur by the end of the year because of failure to obtain the required regulatory clearances, YoCream shareholders will receive an additional $0.97 per share if capital gains tax rates are higher on April 15, 2011, than they were on December 31, 2010.
