Unilever sells Wish-Bone and Western dressings brands to Pinnacle Foods

Unilever, a British-Dutch multinational company, has completed the sale of its Wish-Bone and Western dressings brands to US-based Pinnacle Foods for a total cash consideration of $575m.

The sale includes a wide range of liquid and dry-mix salad dressing flavours under the Wish-Bone and Western brand names, which have combined annual sales of $190m.

It does not include Unilever’s facility in Independence, Missouri, which currently manufactures Wish-Bone and Western brands; however, the facility will continue to manufacture for Pinnacle Foods under a third-party agreement.

The sale is part of Unilever’s strategy to cut down some of its food assets and focus more on personal care products.

It follows the sale of its Skippy peanut-butter business to Hormel Foods earlier this year in a $700m deal.

In August, Unilever agreed to sell its Wish-Bone and Western dressings brands to Pinnacle Foods for $580m in cash.

At the time of signing the deal, Unilever North America president Kees Kruythoff described Wish-Bone as an iconic brand and the number-one Italian dressings brand in the US.

"We believe that the potential of both the Wish-Bone and Western brands can now be more fully realised with Pinnacle Foods," Kruythoff said.

Pinnacle Foods CEO Bob Gamgort said that the acquisition of Wish-Bone is a perfect fit with the company’s strategy of ‘Reinvigorating Iconic Brands’.

"In addition to enabling significant cost synergies and tax benefits, the transaction enhances our ability to offer consumers meal solutions and recipe ideas across our broad portfolio of brands," Gamgort added.

Pinnacle funded the deal through cash on hand and new debt comprising a $525m term loan, due 2020, with terms in line with the company’s existing term loan.

The company reaffirmed its consolidated EPS outlook for the full year of $1.53 – $1.57 with outlook for Wish-Bone to be $0.01 – $0.02 accretive to EPS in the fourth quarter of 2013.

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Image: The sale is part of Unilever’s strategy to cut down some of its food assets and focus more on personal care products. Photo courtesy of Unilever.