Post completes acquisition of Hearthside Food Solutions assets

Post Holdings, the parent company of Post Foods and a manufacturer of ready-to-eat cereals, has completed the acquisition of the branded and private label cereal, granola and snacks business of Hearthside Food Solutions in an all-cash deal worth $158m.

Hearthside Food Solutions, a portfolio company of US-based private equity firm Wind Point Partners, is a contract manufacturer of consumer baked foods and snacks.

With the completion of the acquisition, Post Foods gains ownership of Hearthside Foods’ assets including the Golden Temple, Peace Cereal, Sweet Home Farm and Willamette Valley Granola company brands, as well as its private label granola business.

Both the private label and the acquired branded products are sold primarily through natural and health stores.

Post has also acquired a 135,000ft² manufacturing facility, which produces a range of product and package formats, and a 30,000ft² finished goods warehouse – both located in Eugene, Oregon, where the business will continue to be based.

On 9 May, Hearthside Food Solutions announced that it had entered into a definitive agreement to sell its branded and private label cereal, granola and snacks business to Post Holdings.

At the time of signing the agreement, Post chairman and chief executive officer Bill Stiritz said: "This acquisition will provide us with expanded presence with new retail partners and will be accretive to both top-line growth and earnings."

Post then stated that it plans to lease both the facilities and integrate the acquired business with its Attune Foods business, a branded ready to eat cereal business, which it acquired in December 2012.

The expanded Attune Foods will continue to operate independently and will report to Post Holdings president and chief operating officer Terence Block.

In addition to its Eugene location, the newly combined Attune business will also operate offices in Phoenix, Arizona and San Francisco, California.

The acquisition is expected to contribute approximately $70m to Post Foods’ net sales and about $17m to $19m to EBITDA, inclusive of expected annualised synergies, on a full year basis.

On 15 May, Wind Point Partners announced its plans to merge the remaining assets of Hearthside Food Solutions with Ryt-way Industries, a provider of contract packaging services, a move which will create a leading contract food manufacturer in North America with more than $1bn in sales.

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Image: The acquisition of Hearthside Food Solutions’ assets is expected to provide Post Foods with expanded presence and new retail partners. Photo courtesy of PRNewsFoto/Post Holdings, Inc.