Dive Brief:
- Conagra Brands has entered a definitive agreement to sell the Chef Boyardee brand to Hometown Food company, a part of private equity firm Brynwood Partners, for $600 million.
- Hometown will acquire a Pennsylvania plant and Chef Boyardee’s shelf-stable products, excluding its frozen skillet meals, which will be licensed to Conagra.
- The Chef Boyardee products involved in the deal generated approximately $450 million in net sales during Conagra’s fiscal year 2024. The transaction is expected to be completed before the end of the first quarter, typically in late August.
Dive Insight:
Conagra has been focusing on two main food categories: snacks such as Slim Jim meat sticks and Angie’s Boomchickapop popcorn, and frozen meals like Healthy Choice and Marie Callender’s. The company has divested brands like Peter Pan peanut butter and Wesson cooking oil while acquiring premium meat stick brand Fatty.
“The divestiture of Chef Boyardee is another step in reshaping our portfolio for sustainable growth and reducing debt,” said Conagra CEO Sean Connolly. “By concentrating on our leading frozen and healthy-snacking businesses, we are building a more streamlined company with modern consumer brands.”
Following the $10.9 billion acquisition of Pinnacle Foods in 2018, which added brands like Birds Eye and Duncan Hines to its portfolio, Conagra has focused on strengthening its existing brands and reducing debt.
The sale of Chef Boyardee will help Conagra reduce its debt and position itself for potential future acquisitions.
In a statement, Brynwood Partners CEO Henk Hartong mentioned that the acquisition of Chef Boyardee is their largest in 40 years. The firm plans to revitalize the brand and introduce new formats quickly.
Chef Boyardee, known for its canned pasta offerings like Beef Ravioli and Spaghetti & Meatballs, has been owned by Conagra for over twenty years following the acquisition of International Home Foods in 2000.
Founded by Italian immigrant Hector Boiardi, Chef Boyardee originated from his popular Italian restaurant in Cleveland where customers enjoyed his pasta and sauce recipes, leading to the concept of selling his food for home consumption.