(Adds details, background, shares)
Sept 2 Gifts retailer 1-800-Flowers.com Inc
said it would buy Harry & David Holdings Inc,
known for its gourmet food brands such as Wolferman's English
muffins and Cushman's HoneyBells citrus products, for about
1-800-Flowers.com's shares rose as much as 11 percent in
early trading on Tuesday.
Harry & David started nearly 80 years ago with selling pears
through mail under the Royal Riviera brand. Since then, the
company has expanded its portfolio to other fruits and Moose
Munch popcorn snacks.
Harry & David filed for bankruptcy protection in early 2011
as customers cut orders for its fruit baskets in a weak U.S.
economy. The company exited bankruptcy later that year.
1-800-Flowers.com said Harry & David would operate as its
wholly owned subsidiary after the acquisition, which is expected
to close in October.
The deal, which is expected to add to 1-800-Flowers.com's
revenue and profit in the current fiscal year, will push its
revenue beyond the $1 billion mark, the company said in a
1-800-Flowers.com reported revenue of $735.5 million for the
year ended 2013.
The company said it secured financing for the deal from JP
Morgan Chase and Wells Fargo Bank.
Wells Fargo Securities and Centerview Partners were
1-800-Flowers.com's financial advisers for the deal, while Piper
Jaffray & Co advised Harry & David.
Cahill Gordon & Reindel LLP was 1-800-Flowers.com's legal
adviser and Jones Day advised Harry & David.
1-800-Flowers.com's shares were up 7.8 percent at $5.55 in
early trading on the Nasdaq.
(Reporting by Anya George Tharakan and Abhirup Roy in
Bangalore; Editing by Kirti Pandey)