P&G Sheds Pringles Brand
Diamond Foods, Inc. and The Procter & Gamble Company announce the signing of a definitive agreement to merge the Pringles business into Diamond Foods in a transaction valued at $2.35 billion.
Pringles is the world's largest potato crisp brand with sales in more than 140 countries and manufacturing operations in the United States, Europe and Asia. The global, iconic brand has been built over 45 years with a combination of proprietary products, unique package design and significant advertising investment.
"Pringles is an iconic, billion dollar snack brand with significant global manufacturing and supply chain infrastructure," says Michael J. Mendes, chairman, president and CEO of Diamond Foods. "Our plan is to build upon the brand equity Pringles has established in over 140 countries. This strategic combination will create an independent, global leader in the snack industry with a focus on quality and innovative products. Not only is this combination immediately accretive, it also creates a platform that we believe will allow us to build shareholder value for years to come."
Pringles will join Diamond's dynamic portfolio of brands, which includes Diamond of California and Emerald nuts, Pop Secret microwave popcorn and Kettle Brand potato chips, creating a premium snack-focused company with total revenues of approximately $2.4 billion.
The combination will more than triple the size of Diamond's snack business and:
- Increase scale in U.S. grocery, mass merchandise, drug and convenience channels to gain greater merchandising and distribution influence;
- Leverage Diamond's sales and distribution infrastructure through a more than doubling of snack sales in the U.S. and U.K., which are Pringles' two largest markets;
- Gain a broader global manufacturing and supply chain platform, with access into key growth markets around the world, including Asia, Latin America and Central Europe;
- Increase Diamond's geographic diversity, with international sales accounting for approximately 49 percent of total revenues on a pro forma basis.
"We are confident Diamond Foods will be an excellent new home for our Snacks employees," says Bob McDonald, chairman of the Board, president and CEO of P&G. "This is also a terrific deal for our shareholders – maximizing value and minimizing earnings per share dilution."