B&G Foods to acquire General Mills’ frozen and canned vegetables brands

US-based B&G Foods has agreed to acquire General Mills’ frozen and canned vegetables brands Green Giant and Le Sueur for $765m.

The deal, which will allow B&G to enter into the frozen food business, is expected to close during the fourth quarter of this year. The acquisition is subject to customary closing conditions, including the receipt of regulatory approvals.

B&G Foods president and CEO Robert C. Cantwell said: "For over 100 years, Green Giant and Le Sueur have been providing consumers with great tasting, nutritious vegetables picked at the peak of perfection.

"We look forward to building on that rich history by offering new and innovative products that will respond to the needs of today’s health conscious consumer."

According to Cantwell, the company is planning to double the amount General Mills has been spending on marketing the Green Giant brand, Reuters reported.

The brand has been struggling in the market as consumers increasingly prefer fresher items over the sauced varieties.

General Mills said both the brands have reported annual net sales of approximately $585m in fiscal 2015.

Cantwell added: "Consistent with our acquisition strategy, we expect the acquisition to be immediately accretive to our earnings per share and free cash flow.

"In addition, the acquisition marks our entry into the frozen food category, which we believe will open many future growth opportunities."

The company anticipates that new brands will generate on an annualised basis net sales of approximately $550m following a six to twelve-month transition period.

B&G currently offers shelf-stable snack foods in the US, Canada and Puerto Rico under brands such as VermontMaid and Pirate Brands.

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Image: An open can of peas. Photo: courtesy of Mister GC / Freedigitalphotos.net.