Smucker to buy Folgers in stock deal: report

LOS ANGELES (Reuters) - The J.M. Smucker Co (SJM.N) was close to completing an all-stock purchase of Folgers coffee business from Procter & Gamble (PG.N), the Wall Street Journal reported on Tuesday.

Smucker was expected to complete the deal later this week, people familiar with the situation told the Journal. WSJ said the details weren't known, but the business could fetch a price of $2 billion or more, given Folger's annual sales of $1.6 billion.

The acquisition of Folgers would nearly double the size of Smucker and would give it the top-selling ground coffee brand in the United States, the Journal said.

P & G had decided to sell Folgers, whose 2 percent to 3 percent annual sales growth lags that of the corporation, the Journal said.

P & G declined to comment. Smucker could not be reached immediately for comment.

In January, P & G said it planned to separate its coffee business and create an independent company. P & G has long been expected to separate the coffee business in order to focus on faster-growing categories like health and beauty.

Although P&G said in January that no decision had been made on the form of the separation, it expected to do a spin-off or split-off transaction.

(Reporting by Gina Keating; editing by Carol Bishopric)