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Hormel to buy premium deli meat, salami maker for $850 million
October 31, 2017 / 11:24 AM / 25 days ago

Hormel to buy premium deli meat, salami maker for $850 million

(Reuters) - Spam meat maker Hormel Foods Corp (HRL.N) said on Tuesday it would buy deli meat and salami maker Columbus Manufacturing Inc for about $850 million, pulling off its biggest acquisition that will expand its line of products in grocery stores.

Columbus, owned by Chicago-based Arbor Investments, generates annual sales of about $300 million, which are expected to grow more than 5 percent.

Columbus sells premium craft meats made of chicken, turkey, pork and beef. It began using antibiotic-free meats last year.

The deal will modestly add to Hormel’s earnings in the year beginning November, the company said.

Hormel, which also makes Jennie-O Turkey, has been adding smaller brands to strengthen its prepared meats business as well as broaden its portfolio and presence.

In August, it made two deals, buying Brazilian sausage and salami maker Cidade do Sol for $104 million to enter South America, and Chicago-based Fontanini Italian Meats and Sausages for $425 million.

Hormel was advised by Barclays, while BofA Merrill Lynch and Rothschild provided financial advice to Columbus Manufacturing.

Reporting by Sruthi Ramakrishnan in Bengaluru; Editing by Savio D'Souza and Sai Sachin Ravikumar

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