New York CNN
Campbell, the iconic canned soup brand, is expanding into the Italian food market.
Campbell (CPB), announced on Monday that they would be acquiring Sovos Brands in a $2.7 billion deal. Sovos Brands is the maker of popular Italian food products like Rao’s sauces, Michael Angelo’s frozen entrees as well as Noosa Yogurt.
Mark Clouse, Campbell's President and CEO said that he was "thrilled" to be adding the most compelling growth in the food industry. He also welcomed the talented employees of Campbell who had built up a portfolio worth nearly $1 billion. 'The Sovos Brands Portfolio strengthens and diversifies Campbell's Meals & Beverages Division and paired up with our faster-growing, differentiated Snacks Division, Campbell is one of the most dependable and growth-oriented food names.
Campbell's Meals & Beverages includes SpaghettiO's soups and sauces as well as its juice brand V8. Campbell says Rao's Sauces are a different type of consumer than Pregos.
Rao's is a premium market-leading sauce that complements the mainstream, core portfolio of the company's Meals & Beverages division. It also offers an opportunity to expand into adjacent categories such as frozen meals, pasta and premium ready-to-serve soups.
Campbell's acquisition of premium frozen meal brand Michael Angelo's will allow it to expand its frozen food portfolio, which is already a part of the Pepperidge Farm's label.
Noosa, the popular yogurt brand, is not a core part of the company's strategy. However, the company said that the well-run, profitable business has great products.
Todd Lachman, founder and CEO of Sovos Brands, called the acquisition "a momentous occasion."
In a statement that was included in Campbells' news release, he stated, "We have built an one-of-a kind, high-growth food company, focused on taste led products across a premium brand portfolio, anchor by the Rao’s brand." This transaction will create significant value for our investors, resulting 92% higher than our 2021 IPO.
Campbell shares closed Monday at $44.34, a decrease of $0.81 or 1.79%.