ConAgra to acquire Del Monte Canada

US-based packaged foods company ConAgra Foods has agreed to acquire Del Monte Canada, a provider of packaged fruits, fruit snacks and vegetables, from an affiliate of private investment firm Sun Capital Partners for an undisclosed sum.

The move is part of ConAgra’s strategy to grow key businesses to strengthen its global presence and expand into strategic adjacencies.

ConAgra Foods CEO Gary Rodkin said the acquisition of Del Monte Canada supports the company’s strategic growth plan. "It will grow our position in North American tomato products, expand our vegetable product line and add packaged fruit and fruit snacks to our portfolio," Rodkin added.

The acquisition includes all of Del Monte branded packaged fruit, fruit snacks and vegetable products in Canada, Aylmer tomato products, a manufacturing plant in Dresden, Ontario, and the company headquarters in Toronto, Ontario.

Del Monte fresh produce, juices and Aylmer soups, however, will be held under separate ownership. Del Monte Canada, which has 190 employees, offers canned fruits, refrigerated fruits, and canned tomatoes and vegetables in Canada, and it reported revenue of $150m in fiscal 2011. It was operated by Kraft Foods and was known as CanGro Foods until it was acquired by a Sun Capital affiliate in January 2006.

ConAgra Foods currently has over 300 employees at three locations in Canada, including its headquarters in Ontario, and its consumer brands include Healthy Choice, Orville Redenbacher’s, Hunt’s, Snack Pack, Chef Boyardee, PAM, POGO and VH, among others.

The transaction is subject to the satisfaction of closing conditions and regulatory approvals.

The US-based company has been exploring acquisitions, especially in the private label segment, after it failed to acquire Ralcorp, a private-label company that manufactures ready-to-eat food and snacks. It recently acquired National Pretzel Company from Brookstone for a cash purchase price of approximately $300m, and in November, it paid $10m to an unidentified third party to become a major stakeholder in India-based Agro Tech Foods.

Caption: ConAgra’s move to acquire Del Monte Canada is a part of its strategy to grow key businesses to strengthen its global presence and expand into strategic adjacencies. Image courtesy of ConAgra.