ConAgra Foods, Inc.,
) recently announced the completion of its acquisition of Home Menu
frozen meals brands--Bertolli
and P.F. Chang's
). The deal closed for a total cash consideration of $267
million. Such a cash consideration during the conclusion of the
deal, however, is subject to adjustments.
The buy-out was announced on July 30, 2012, in an acquisition
agreement between the two parties. The frozen meals businesses
acquisition now includes a license for use of the Bertolli brand
name in favor of ConAgra. Also, the acquisition entails transfer of
Unilever's existing license for use of Home Menu brand name of P.F.
Chang to the food maker.
Such strategic acquisitions, which comprehensively embrace the
principal businesses along with the use of licenses, add value to
ConAgra; helping the company further expand its portfolio of Marie
, Healthy Choice
, Slim Jimand Kid Cuisine
ConAgra Foods Inc., one of North America's leading food
companies, with its wide array of brands in almost 97% of America's
households; serves grocery retailers, restaurants and other
foodservice establishments. Thus, the company's strategic
acquisitions fit in well with the existing capabilities of ConAgra
Foods as it expands its business portfolio and presence across the
food market. Moreover, its promotional campaigns, strong sales
force, dedicated customer-serving teams, and category leadership
continue to add depth and dynamism to its existing product
The company primarily competes with
HJ Heinz Co.
Kraft Foods Inc.
). The current Zacks Consensus Estimate is pegged at 36 cents for
the company. We have a Neutral recommendation on ConAgra over the
long term. Also, ConAgra has a Zacks #2 Rank, implying a short-term
(1-3 months) Buy rating.
CONAGRA FOODS (CAG): Free Stock Analysis Report
HEINZ (HJ) CO (HNZ): Free Stock Analysis Report
To read this article on Zacks.com click here.