TreeHouse Foods sells snack division
Oak Brook, Ill.-based TreeHouse Foods has entered into a definitive agreement to sell its snacks division to Atlas Holdings LLC. The snacks division, with more than 800 employees, is one of the largest manufacturers and distributors of private label healthy snacks to retail customers in North America and is a leader in the nuts and trail mix categories, according to TreeHouse, which manufacturers and distributes private label packaged foods and beverages in North America.
Atlas agreed to pay $90 million for the snacks division. The transaction is subject to customary closing conditions and is expected to close in the third quarter of 2019. Atlas owns and operates 19 manufacturing and distribution businesses, which collectively employ more than 17,000 associates at over 150 facilities worldwide.
TreeHouse said it projected the division to generate net sales of about $670 million in 2019. TreeHouse plans to use the net proceeds of the sale to pay down debt. TreeHouse said it will update its full-year guidance to reflect the transaction in its second-quarter earnings announcement.
The snack division operates three plants located in Robersonville, N.C.; El Paso, Texas; and Dothan, Ala. A fourth plant in Minneapolis is scheduled to close by the end of the third quarter as previously announced. The Minneapolis plant, and the manufacturing-related employees located there, are not included in this transaction.
"The sale of the snacks division is a key step in optimizing TreeHouse's overall product portfolio. It is the culmination of TreeHouse's strategic review of its snacks business," said Steve Oakland, CEO and president of TreeHouse Foods. "This transaction allows the snacks division to unlock its potential and serve its customers even better under Atlas' ownership. We are grateful for the hard work put forth by the snacks team during these last several years."
Michael Sher, partner of Atlas Holdings, said the snacks business will be a welcome addition to the Atlas family of manufacturing and distribution companies.
"Customers are consistently choosing private label brands, and this business is a premier manufacturer with unique growth potential,” Sher said. “We're excited to partner with this team to deliver the finest healthy, private label snacks in the industry."