Utz Brands said on Tuesday it has agreed to be acquired by Germany’s Intersnack Group in a deal valued at about $2.9 billion, including debt, that would take the salty snacks maker private and give the European firm a foothold in the U.S. market.
The deal comes amid a wave of mergers and acquisitions across the consumer goods and health sectors, as companies consolidate to better withstand inflationary pressures, shifting consumer tastes and fierce competition. Earlier this month, U.S. grocer Kroger agreed to acquire regional supermarket chain Giant Eagle in a $1.65 billion deal.
Intersnack, a private family-founded snack company, said it would buy all outstanding shares of Utz Brands for $14.25 per share in cash, representing a premium of 91.3% to the U.S. company’s last closing price.
Shares of Utz, the maker of Chips & Dips and Zapp’s, were up about 88% at $14.02 in premarket trading.
Following the deal’s completion, Intersnack will own 50% of the company, while the Rice and Lissette family entities, representing descendants of Utz’s founding family, will own the rest.
“Our partnership with the Rice and Lissette Family, and commitment to Utz, represents a compelling opportunity for Intersnack to expand our exposure into the large and attractive U.S. snacking market, where we do not currently have a presence,” said Johan van Winkel, executive chairman of Intersnack Group.
Utz said the deal will be financed through about $920 million of cash from Intersnack, a $1.1 billion term loan facility, a $250 million asset-based lending facility, as well as rollover and reinvested equity from the Rice and Lissette family.
Dylan Lissette will become executive chair of Utz after the deal closes, which is expected in the fourth quarter.
Source: Reuters.com