ConAgra Foods, Inc. said Monday it has reached an agreement to sell majority of its private label operations to TreeHouse Foods for approximately $2.7 billion.
“The sale of our private label business marks another important milestone as we remake ConAgra Foods into a focused, higher-margin, more contemporary and higher-performing company,” said Sean Connolly, president and CEO of ConAgra.
Connolly added the transaction will help the company refocus on building its consumer foods and commercial foods segments—which include recognized brands such as Chef Boyardee, Healthy Choice, Peter Pan, Hunt’s and Slim Jim.
Under the terms of the agreement, ConAgra Foods will divest most of its private label operations, which are classified as discontinued operations. Among other assets, this includes a network of 32 manufacturing facilities in the U.S., Canada and Italy. ConAgra Foods will retain certain private label operations with a strong connection to its existing consumer foods business, specifically canned pasta, cooking spray, peanut butter, pudding/gels, Gelit frozen pasta product offerings, as well as the HK Anderson and Kangaroo brand equity, trademark and business portfolios.
The transaction is subject to customary closing conditions and regulatory clearances, and is expected to close in the first quarter of calendar year 2016.