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Campbell Soup
Co.
CPB 0.97%
is in talks to sell its fresh food business, including Bolthouse Farms, to investors led by its former chief executive, according to people close to these talks.
Jeff Dunn, who helped a private equity firm sell Bolthouse in Campbell six years ago for $ 1.55 billion, later co-founded and remains an investor in Campbell's venture capital fund, Acre Venture Partners. He also served as President of Campbell's Fresh Food Unit.
The fresh produce unit, including fresh carrots and Bolthouse chilled juices, as well as Garden Fresh salsa and other products, suffered from supply chain issues. Campbell has reduced its value by about a billion dollars. It could sell between $ 500 and $ 700 million, according to other people familiar with the company.
Others, including strategic buyers and private equity firms, have also expressed interest in the company, but discussions with Dunn's group go further, officials said. Mr. Dunn, a former
Coca Cola
Co.
Executive, collaborates with private equity investors
Bolthouse's sales and operating profit have fallen sharply in recent years. In August, Campbell announced its intention to sell the fresh produce unit after a strategic review. The soup giant is also looking to sell its international business, including the Arnott and Kelsen biscuit brands, which are expected to attract wide interest, according to people familiar with the process.
The divestment of international operations and fresh operations, expected to generate one-fifth of Campbell's revenue this fiscal year, would allow the company to focus on a core soup business that has been in decline for years. Board members said that a leaner Campbell could be more attractive to potential buyers of the remaining company.
Campbell is also facing a proxy fight with third-party activist investor LLC, which had previously called for the sale of the entire company and is now seeking to replace its 12-member board of directors. people. The vote will take place at Campbell's annual meeting of shareholders on November 29th.
Third Point, who works with a Campbell heir, said in a presentation to shareholders this week that the company's strategic review was flawed, recommending assignments that "largely preserve the status quo." ".
The hedge fund, managed by investor Daniel Loeb, also said the board had "completely sabotaged" its pivot in fresh food and that its directors would quickly stabilize the unit by reducing costs.
The fate of Campbell depends largely on the decision of the descendants of the founder of his condensed soup. Heirs own at least 45% of the shares of the company.
When Campbell agreed to buy Bolthouse Farms at private equity firm Madison Dearborn Partners LLC in 2012, Denise Morrison, Campbell's new CEO at the time, announced that she would manage the business. 39 company separately to avoid diverting Campbell from repairing his major brands in the North. America business.
Campbell bought Garden Fresh in 2015 for $ 231 million.
Ms. Morrison did not solve the problems associated with stagnant soup sales, and low carrot harvests and juice recalls hurt Bolthouse sales and retailer relationships. Campbell has struggled to master a fresh produce supply chain that is radically different from his long-standing sector of soups and canned biscuits.
Ms. Morrison resigned in May. The company is always looking for a permanent successor.
Write to Annie Gasparro at [email protected] and Cara Lombardo at [email protected]
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