Hershey Nears $1.6 Billion Deal to Buy Amplify Brands
Tehran (KNA) - Hershey Co. is near a $1.6 billion deal to buy Amplify Snack Brands Inc., according to CNBC, which cited unidentified sources familiar with the matter.
The deal values Amplify at $12 a share, CNBC said, which would represent a 71 percent premium to Friday's closing price of $7 a share. Amplify, based in Austin, Texas, has a market cap of $537 million and markets brands including SkinnyPop popcorn.
Total debt as of Sept. 30 was $590.5 million, according to data compiled by Bloomberg.CNBC said the deal could be announced as early as Monday.
Hershey's move signals the intent of new Chief Executive Officer Michele Buck to lead consolidation in the snacks industry after the maker of Kisses sweets rejected a takeover bid
from Oreos-maker Mondelez International Inc. During a March investor meeting, Hershey's management said it is particularly interested in companies that have accelerated growth in the U.S. snack industry.
Hershey shares have gained 10 percent this year, valuing the company at $24 billion.The U.S. confectionery business has been consolidating amid sluggish demand for chocolate.
Among other deals in the sector, Mars Inc., the maker of M&Ms and Snickers, purchased a minority stake in another in snack company, Kind Bar, last month. Kellogg Co.
signed a $600 million deal for protein bar maker Rxbar in October. Hershey has been mentioned as one of the company's planning to bid for Nestle SA's U.S. confectionery division.
Source: bloomberg