Camden-based Campbell Soup Company has signed a definitive agreement for the sale of Arnott’s and certain of Campbell’s International operations to KKR, a leading global investment firm, for $2.2 billion in cash, subject to customary purchase price adjustments. Combined with the previously disclosed sale of Kelsen Group, Campbell has announced the sale of its entire Campbell International division for an aggregate price of $2.5 billion.
Acquired by Campbell in 1997, Arnott’s is one of Australia’s most iconic brands. Arnott’s regional headquarters are based in Sydney with operations in Western Sydney, Brisbane, Adelaide and Bekasi, Indonesia. Campbell’s International operations include Campbell’s simple meals businesses in Australia, Malaysia, Hong Kong and Japan, and manufacturing in Australia and Malaysia. Arnott’s and Campbell’s International operations had combined net sales of approximately $885 million in the latest 12 months and employ approximately 3,800 people.
Mark Clouse, Campbell’s president and CEO, said, “This was a thorough and complex process in which we considered many options. Our approach has resulted in agreements that we believe generate the greatest value from our international assets. By applying almost $3 billion of divestiture net proceeds to reduce debt, Campbell’s balance sheet will be stronger and capable of supporting our plan to grow our focused and differentiated portfolio.”
Under the terms of the agreement, Campbell and KKR will enter into a long-term licensing arrangement for the exclusive rights to use certain Campbell brands, including Campbell’s, Swanson, V8, Prego, Chunky and Campbell’s Real Stock, in Australia, New Zealand, Malaysia and other select markets in Asia, Europe, the Middle East and Africa.
In August 2018, Campbell announced it would divest Campbell International and Campbell Fresh to focus the company on its core North American businesses and reduce debt. The company completed the divestiture of its Campbell Fresh operations in June 2019, generating proceeds of approximately $565 million. The sale of Campbell International, including the recently announced sale of Kelsen Group to a Ferrero affiliated company for $300 million, is expected to generate proceeds of approximately $2.5 billion. Campbell will use the expected aggregate net proceeds of $3 billion to reduce the company’s debt.
Closing for Arnott’s and Campbell’s International operations, as well as Kelsen Group, is expected in the first half of fiscal 2020.
Campbell was advised by Centerview Partners, Goldman Sachs, Weil, Gotshal & Manges LLP and King & Wood Mallesons. KKR was advised by Jefferies LLC.
To access more business news, visit NJB News Now.Related Articles: