Hero acquires leading US baby-food producer

12/10/05 As a result of its acquisition of Beech-Nut Nutrition Corporation Hero becomes the #2 player in the US baby-food market. Beech-Nut, previously owned by the private equity house, Madison Dearborn Capital Partners, is headquartered in St. Louis Missouri and enjoys a market share of 15% in the US by virtue of its strong brand equity, wide product portfolio of around 180 articles and nationwide distribution. The 100% acquisition is subject to approval from the US anti-trust authorities. No details of transaction terms and conditions have been released.

This transaction marks a further milestone in Hero’s strategy to build an international position within Infant Nutrition. In addition, according to Hero CEO Stefan F. Heidenreich, the acquisition is fully consistent with the Group’s goal to strengthen the Group’s position outside its Western European heartland, and offers the Group new growth opportunities within the US and Canadian markets.

As a result of this acquisition the proportion of Group revenues within the Infant Nutrition category rises from 17% to almost 30%. The Group now generates around 50% of its total revenues within the area of Nutrition.

Hero is an international food group predominantly focused on branded consumer foods. Qualitatively high-value products and qualified employees ensure the Group maintains its leading market positions and delivers sustainable and profitable growth in its core categories. Founded in 1886 in Lenzburg Switzerland, the Group’s branded product portfolio is focused on the core categories of Fruit (38% of 2004 sales), Infant Nutrition (17%), Cereals (8%) and Decorations (23%). 2004 total group revenues amounted to CHF 1.359 billion and the group had an employee base of over 3,300 in 26 countries. Since 2003, the Group has been in private ownership.

Beech-Nut Nutrition Corporation, based in St. Louis (Missouri), is the #2 producer of baby food in the US with a market share of 15%. Founded in 1899, the Company has up until the present day maintained its production facilities in Canajoharie (New York). Beech-Nut is renowned as a leading-edge player within the category as a result of numerous original and ground-breaking innovations. Beech-Nut was the first US producer to offer baby food in glass jars and products without added salt or sugar. Further, since 1985, all Beech-Nut products have been free of all chemically modified starches.

http://www.hero.ch/