Bellisio Foods buys Overhill Farms
Bellisio Foods entered into a definitive merger agreement to purchase Overhill Farms in a merger transaction valued at approximately $80.9 million. Under the terms of the agreement, Overhill Farms shareholders will receive $5 in cash for each share of Overhill Farms common stock they own. The transaction represents a 26% premium over the closing price of Overhill Farms common stock on Aug. 13, 2012, prior to the company’s announcement that it was reviewing strategic alternatives, and a 25% premium over the average of the closing price of the common stock during the 60 calendar days ended May 13,2013, the last day prior to entering into the merger agreement.
For the past two years, Overhill Farms, Inc., a Vernon, Calif.-based supplier of custom high-quality prepared frozen foods for branded retail, private label and foodservice customers, and Bellisio Foods, Inc., a Minneapolis-based producer of frozen entrées, have produced and distributed frozen meals under the Boston Market brand through an exclusive co-manufacturing and distribution agreement.
“After conducting an extensive review of potential strategic alternatives, our board concluded that this all-cash transaction was the best path to maximizing value for our shareholders,” says James Rudis, chairman and CEO of Overhill Farms. “Additionally, in the course of our partnership on the Boston Market brand, we have seen that Bellisio is a company very similar to ours in terms of their business philosophy, corporate culture, focus on quality and customer service and their entrepreneurial spirit. We know that our customers will continue to be well served, and that the clear synergies in this transaction will make both companies stronger.”
“We believe that Overhill’s brand portfolio and West Coast manufacturing presence enables us to unlock meaningful synergies and better serve existing and new customers through expanded capabilities and a broader offering,” says Joel Conner, Bellisio’s chairman and CEO. “We look forward to working with Overhill Farm’s employees and customers as we incorporate this business into Bellisio.”
The transaction, which is expected to close during the fourth quarter of fiscal 2013, is subject to approval from Overhill Farms shareholders, regulatory approvals and other customary closing conditions. The proposed transaction is not subject to a financing condition.