B&G Foods Inc. recently announced that it has entered into a definitive agreement to acquire Back to Nature Foods Co. LLC, a leader in the better-for-you snack food category, from Brynwood Partners VI LP, Mondelēz International and certain other entities and individuals for approximately $162.5 million in cash, subject to customary closing and post-closing working capital adjustments.
B&G Foods expects the acquisition to close during the third quarter of 2017, subject to customary closing conditions, including the receipt of regulatory approvals.
“We are very pleased to add Back to Nature to the B&G Foods family of brands. Consistent with our acquisition strategy and our recent Green Giant, spices & seasonings and Victoria acquisitions, we are continuing to diversify our portfolio of brands and invest in brands and products that we believe are most relevant to today’s consumer,” stated B&G Foods president and chief executive officer Robert C. Cantwell.
B&G Foods expects the acquisition to be immediately accretive to its earnings per share and free cash flow and projects that, following the completion of a six-month integration period, the acquired business will generate on an annualized basis net sales of approximately $80 million and adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) of approximately $17 million. Based upon the foregoing adjusted EBITDA guidance, the acquisition represents a purchase price multiple of approximately 9.6 times adjusted EBITDA (or 8.4 times adjusted EBITDA net of the present value of expected tax benefits).
Back to Nature Foods has been a pioneer in the better-for-you snack food category and is a leading cookie and cracker brand in the category. The Back to Nature brand’s product offerings include Non-GMO Project Verified, organic and gluten-free products. It also offers the SnackWell’s brand of low-fat and nonfat snacks.
B&G Foods intends to fund the acquisition and related fees and expenses with additional revolving loans under its existing credit facility.