Ill.-based food manufacturer,
TreeHouse Foods, Inc.
), recently entered into a definitive agreement to acquire Cains
Foods, for $35 million. Cains is a privately held Mass.-based
manufacturer of shelf-stable mayonnaise, dressings and
Cains, which generates annual revenues of approximately $80
million, sells private label store brands as well as the Cains,
Naturally Delicious and Olde Cape Cod brands to leading food
service distributors, national chains and retailers. Therefore,
it is a perfect fit for TreeHouse which primarily serves the
retail grocery and foodservice channels. TreeHouse's products
include pickles and related products; non-dairy powdered coffee
creamer; and other food products including aseptic sauces,
refrigerated salad dressings, and liquid non-dairy creamer.
TreeHouse's 2014 earnings are expected to go up by 5 cents per
share with the addition of Cains, though the acquisition will
have a neutral impact on the 2013 earnings. The purchase price of
$35 million is subject to adjustments for working capital and
taxes. The transaction is expected to close within a month and
will be financed with TreeHouse's current $750 million credit
Some recent acquisitions by TreeHouse include - Aseptic cheese
and pudding business from Minn.-based dairy marketing cooperative
Associated Milk Producers Inc. in Nov 2012; and Atlanta-based
food company, Naturally Fresh, Inc., in the second quarter of
2012. These acquisitions played an important role in pulling up
the company's revenues in the first quarter of 2013, results of
which were announced in May this year.
Other Stocks to Consider
TreeHouse carries a Zacks Rank #3 (Hold). Other stocks in the
food business that are currently doing well and are worth
Flower Foods Inc.
Omega Protein Corp.
B&G Foods Inc.
), all carrying a Zacks Rank #1 (Strong Buy).
B&G FOODS CL-A (BGS): Free Stock Analysis
FLOWERS FOODS (FLO): Free Stock Analysis
OMEGA PROTEIN (OME): Free Stock Analysis
TREEHOUSE FOODS (THS): Free Stock Analysis
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