CAMDEN, N.J.–(BUSINESS WIRE)–Campbell Soup Company (NYSE: CPB) today announced it has completed the acquisition of Sovos Brands, Inc. for $23 per share in an all-cash transaction, which represents a total enterprise value of approximately $2.7 billion.
“This important milestone in Campbell’s history adds several market-leading and scaled premium brands to our company,” said Campbell’s President and CEO Mark Clouse. “It accelerates Campbell’s successful strategy and provides a substantial runway for sustained profitable growth. An enhanced Meals & Beverages division paired with our differentiated Snacks division creates an advantaged portfolio that makes Campbell one of the most dependable and growth-oriented large capitalization value names in food.”
The Sovos Brands portfolio consists of a variety of premium products including pasta sauces, dry pasta, soups, frozen entrées, frozen pizza and yogurts under the brand names Rao’s, Michael Angelo’s and noosa. Sovos Brands recently reported $1.0 billion in net sales for the year ended Dec. 30, 2023 with an organic net sales increase of 25%1 year over year. Rao’s organic net sales increased 37%2, generating $775 million in annual revenue as it continued its march toward becoming a $1 billion brand.
New Distinctive Brands Business Unit within Meals & Beverages Combines Acquired Brands with Pacific Foods to Drive Accelerated Growth
To drive the continued growth trajectory of these premium brands, the company has formed a new business unit within the Meals & Beverages division called Distinctive Brands. Pacific Foods, a significant growth engine since it was acquired in December 2017, will be paired with Rao’s, Michael Angelo’s and noosa to form the unit. The other three business units in the Meals & Beverages division are U.S. Retail, Canada and Foodservice.
Distinctive Brands will be led by Risa Cretella, Senior Vice President and General Manager, and will have dedicated teams supported by Campbell’s scaled capabilities. Cretella most recently served as Chief Sales Officer at Sovos Brands. She will report to Mick Beekhuizen, Campbell’s Executive Vice President and President, Meals & Beverages.
“We’re excited to welcome the talented Sovos team to Campbell,” said Beekhuizen. “Risa is an accomplished leader with a strong record of growth and impact at Sovos, which makes her the right person to lead the Distinctive Brands business unit and build upon the trajectory and incredible momentum of these premium brands. Our Distinctive Brands business unit will fuel the transformation of our Meals & Beverages categories to accelerate growth.”
The noosa brand is a well-run business supported by a dedicated team. As stated when the acquisition was announced, Campbell plans to evaluate strategic alternatives for the brand.
Significant Long-term Shareholder Value Creation Through Sales and Earnings Growth Contribution
The company expects a fast and effective integration given Campbell’s familiarity with the categories and its strong capabilities, processes and proven integration playbook.
The transaction is expected to be accretive to adjusted diluted earnings per share by the second year of ownership, excluding one-time integration expenses and costs to achieve synergies.
Campbell’s supply chain excellence and scale are expected to drive operating synergies, while improving scale efficiency of Campbell’s core operations. The company expects annualized cost synergies to reach approximately $50 million over the next two years.
Campbell will discuss the impact of the acquisition to its fiscal 2024 guidance when the company reports third-quarter earnings in June.
About Campbell
For more than 150 years, Campbell (NYSE:CPB) has been connecting people through food they love. Generations of consumers have trusted us to provide delicious and affordable food and beverages. Headquartered in Camden, N.J. since 1869, the company generated fiscal 2023 net sales of $9.4 billion. Our portfolio includes iconic brands such as Campbell’s, Cape Cod, Goldfish, Kettle Brand, Lance, Late July, Milano, Michael Angelo’s, noosa, Pace, Pacific Foods, Pepperidge Farm, Prego, Rao’s, Snyder’s of Hanover, Swanson and V8. Campbell has a heritage of giving back and acting as a good steward of the environment. The company is a member of the Standard & Poor’s 500 as well as the FTSE4Good and Bloomberg Gender-Equality Indices. For more information, visit www.campbellsoupcompany.com.
