Six months after entering Chapter 11 bankruptcy protection, Del Monte Foods Corp. has landed deals to sell its core brand assets to Fresh Del Monte Produce Inc., B&G Foods Inc. and Pacific Coast Producers.
Walnut Creek-based Del Monte said Jan. 15 that, under the court-supervised auction, Fresh Del Monte Produce has agreed to buy its vegetable, tomato and refrigerated fruit businesses. Those assets include the Del Monte and S&W packaged vegetable brands; Del Monte, Contadina and Take Root Organics packaged tomato brands; Del Monte refrigerated fruit brand; and the Joyba beverage brand. Coral Gables, Fla.-based Fresh Del Monte Produce also is slated to acquire global ownership of the Del Monte brand and related intellectual property, subject to current licensing arrangements.
Parsippany, NJ-based B&G Foods has agreed to purchase Del Monte’s broth and stock businesses, including all the assets of its College Inn and Kitchen Basics brands. Pacific Coast Producers is acquiring Del Monte’s shelf-stable fruit businesses, excluding its production assets.
The deal with Pacific Coast, a Lodi, Calif.-based agricultural cooperative that specializes in canning fruit and tomatoes for private labels, includes the rights and licenses to use the Del Monte and S&W brands for shelf-stable packaged ambient fruit and ambient fruit sauces in the United States, including Puerto Rico, and in Mexico.
Fresh Del Monte Produce said its asset purchase from Del Monte totals $285 million, and B&G said it’s buying Del Monte’s soup assets for $110 million in cash. Both deals also include the assumption of certain liabilities. Financial terms of Del Monte’s transaction with Pacific Coast weren’t disclosed.
Del Monte noted the three asset purchase agreements include substantially all of its assets and business operations “as going-concern businesses” and the sales will provide a “clear path forward” for those businesses to continue.
“This outcome represents a successful result in our sale process and demonstrates the enduring value of Del Monte Foods’ brands and operations,” said Greg Longstreet, chief executive officer of Del Monte Foods. “These transactions will create an opportunity for our beloved brands and businesses to thrive under the ownership of three of the leading companies in the food industry. We are committed to working closely with all parties to support a smooth transition of operations and are grateful to our team members, customers and vendor partners for their steadfast commitment and meaningful contributions to Del Monte Foods during this pivotal time.”
Del Monte Foods announced its initiation of Chapter 11 bankruptcy proceedings last July, along with plans to seek sales of the company’s assets. At the time, the food manufacturer said it had secured $912.5 million in debtor-in-possession financing from lenders.
The asset sales are pending approval of the US Bankruptcy Court for the District of New Jersey at a Jan. 28 hearing, as well as customary closing conditions. Del Monte expects the ownership transitions to be completed by the end of the 2026 first quarter. The company said it continues to serve customers and fulfill orders across its brand portfolio at this time.
Fresh Del Monte said its purchase will bring the Del Monte brand under a single owner for the first time in nearly four decades. Its deal includes certain facilities in Texas, Illinois, Wisconsin and Washington plus two facilities in Mexico and one in Venezuela. Plans call for Fresh Del Monte to run the acquired brands in a dedicated business unit, and the company said no immediate changes are slated for products now on shelves.
“Bringing the Del Monte brand back together reflects a long-held conviction of mine,” said Mohammad Abu-Ghazaleh, chairman and CEO of Fresh Del Monte Produce. “By uniting fresh and shelf-stable food under one strategy, we are honoring the brand’s legacy while supporting it for continued relevance and growth. It allows us to show up more consistently for consumers and to build a stronger, more flexible platform focused on efficiency, innovation and long-term value creation.”
B&G estimated that its planned purchase of the College Inn and Kitchen Basics brands will add annual net sales of approximately $110 million to $120 million.
“We are very excited to be the winning bidder for Del Monte’s broth and stock business and to add the College Inn and Kitchen Basics brands to the B&G Foods portfolio,” said Casey Keller, president and CEO of B&G Foods. “The College Inn and Kitchen Basics brands complement our existing portfolio of brands. College Inn and Kitchen Basics are pantry staples for consumers seeking to prepare high-quality, innovative and versatile meals at home. This acquisition is consistent with our longstanding acquisition strategy of targeting well-established brands with defensible market positions and strong cash flow at reasonable purchase price multiples.”
By Russell Redman
Source: foodbusinessnews.net
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