Post Holdings to explore options for private brands business

(Reuters) - Post Holdings Inc POST.N said on Thursday it would explore options, including a sale, for its private brands business, which makes nut butter, dried fruits, pasta and granola products for retailers and distributors.

The company said the options also include an initial public offering, a private equity placement and a strategic combination.

Post’s shares were up 2.5 percent at $81 in light premarket trading on Thursday.

The company operates its business under five units: Post Consumer Brands, Michael Foods Group, Active Nutrition, Private Brands and Weetabix.

Post said it would now create two more units - refrigerated retail and food service - after it closes the acquisition of frozen foods maker Bob Evans Farms by January 12.

In its most recent quarter, sales at the private brands business rose 7 percent to $114 million, or about 8 percent of total sales. The unit counts grocers Whole Foods Market and Aldi as its top customers.

Jim Dwyer, current chief executive of the Michael Foods Group unit, will lead the private brands business.

Reporting by Vibhuti Sharma in Bengaluru; Editing by Bernard Orr and Saumyadeb Chakrabarty