Campbell Soup Company
) recently announced that it had signed a deal with private
equity firm, CVC Capital Partners to offload its European
operations. The terms of the deal, however, were not disclosed by
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This divestment is the company's latest effort to move away from
its troubled canned soup business and to enhance its presence in
the packaged fresh food market.
The divestment includes Campbell Soup's brands of sauces, soups
and easy meals. Some of these brands are Erasco in Germany,
Liebig and Royco in France, Blå Band in Sweden and Devos Lemmens
and Royco in Belgium. The 4 production plants of the company
located in France (Le Pontet), Sweden (Karpalund) Belgium (Puurs)
and Germany (Lubeck) also forms part of the divestiture.
The Camden, N.J.-based manufacturer of high-quality food and
simple meals has made it clear that this particular transaction
will not involve the company's export business of Pepperidge Farm
products throughout Europe and its businesses in the U.K., the
Middle East as well as Africa. Further, Denmark-based Kelsen
Group A/S, which was recently acquired by Campbell Soup, will
continue with its regular operations.
The transaction is likely to close in first-quarter fiscal 2014,
subject to the approval of the concerned European competition law
authorities. The operations that are to be offloaded generated
annual revenue of about $530 million in fiscal 2012.
Allen & Overy LLP will act as the financial advisor to
Campbell Soup while CVC Capital will have Leopold Capital
), Cleary Gottlieb Steen & Hamilton LLP and Ernst & Young
as its financial advisors.
Campbell Soup, which currently carries a Zacks Rank #3 (Hold),
intends to boost its top line and increase returns on investment
through strategic measures. During fiscal 2012, the company made
significant progress in this direction, including stabilization
of the North American soup and simple meal business, overseas
expansion and growth of healthy beverages and baked snacks
businesses. We believe that Campbell Soup's prudent investment
and strategic initiatives toward product innovation and brand
building will lead to an increase in its customer base and
Other well-performing stocks in the retail space include
Dole Food Company Inc.
Chiquita Brands International Inc.
). Both of them carry a Zacks Rank #1(Strong Buy).