ConAgra to acquire Unilever’s North American frozen meals business

US packaged foods company ConAgra has entered into an agreement to acquire Unilever’s North American frozen meals business in an all-cash deal of $265m, a move which will strengthen its frozen food business.

The deal will mark ConAgra’s fifth acquisition over the last 12 months after it failed in its efforts to acquire US food firm Ralcorp.

Unilever’s frozen meals portfolio in North America includes a full range of multi-serve frozen entrees and appetisers under the Bertolli and PF Chang’s brands, which have combined annual revenues of approximately $300m.

The transaction will include a licence for ConAgra to use the Bertolli brand name as well as the transfer of Unilever’s licence to use the PF Chang’s Home Menu brand name.

The deal will include key manufacturing equipment, which will be relocated to an existing ConAgra Foods plant, but will not include Unilever’s facility in Owensboro, Kentucky, where Bertolli and PF Chang’s frozen meals are currently produced.

ConAgra Foods chief executive officer Gary Rodkin said the company will employ its frozen food and innovation capabilities to grow the brands further.

"Just as our acquisition earlier this calendar year of Odom’s Tennessee Pride extended our reach into frozen breakfasts, the addition of Bertolli and PF Chang’s brands can bring us new consumers and new eating occasions," Rodkin added.

ConAgra noted that this acquisition will complement its existing frozen food brands such as Marie Callender’s, Banquet, Healthy Choice and Kid Cuisine, and provide growth opportunities in the segment.

The transaction is part of ConAgra’s strategy to grow its core businesses, expand into adjacent categories, build its private label business, and continue to develop its international presence.

The acquisition is expected to be completed within the next 30-60 days subject to customary closing conditions.

Meanwhile, Unilever said that the agreement to divest its North American frozen meals business is part of its plan to exit the frozen foods business – in 2006, it sold its European frozen foods business to private equity firm Permira for €1.72bn.

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Image: ConAgra eyes growth opportunities in the frozen food segment with the acquisition of Unilever’s North American frozen meals business. Photo: ConAgra Foods.