ConAgra Foods, Inc., Omaha, Neb., is said to acquire St. Louis-based Ralcorp Holdings, Inc., the largest manufacturer of private label food in the United States. Under the terms of the agreement, Ralcorp shareholders will receive $90 per share in cash for each outstanding share of common stock held, representing a 28.2% premium to the closing price of Ralcorp’s common stock on Nov. 26, and a 24.9% premium to the average closing price of Ralcorp’s common stock for the 30 trading days ending Nov. 26. The transaction is valued at approximately $6.8 billion, including the assumption of debt.
This transaction creates one of the largest packaged food companies in North America, with sales of approximately $18 billion annually and more than 36,000 employees. It will also position ConAgra Foods as the largest private label packaged food business in North America, with combined private label sales of approximately $4.5 billion.