Post Holdings to buy Dakota Growers
Post Holdings Inc. is the maker of Raisin Bran and Honey Bunches of Oats cereals. The company had agreed to acquire Dakota Growers Pasta Co. in a deal valued USD370 million. Dakota Growers is the pasta unit of Glencore Xstrata Plc. The acquisition for the pasta unit was Post Holdings' move to expand its food offerings.
The acquisition was said to be completed in January. It would add around USD300 million to sales and a hefty USD46 million earnings before interest, taxes, depreciation and amortization. This was according to a statement issued yesterday by the St. Louis based company. In the same statement, Post added that the North American pasta market is worth approximately USD5 billion a year.
Chairman and Chief Executive Officer Bill Stiritz for Post Holdings said, "Post continues to expand its portfolio into segments of the overall food industry where it sees opportunities to grow and diversify its strong cash flow."
Post rose 4.6% to close at USD43.86 in New York yesterday.