Tyson Buying AdvancePierre for $4.2 Billion

April 25, 2017
Sandwich-maker brings new markets to Tyson, which also is shopping three recent acquisitions.

Two new CEOs lost no time shaking up the food world.

Tyson Foods Inc. has agreed to pay $4.2 billion for AdvancePierre Foods Holdings Inc., a Cincinnati-based distributor of ready-to-eat sandwiches and other items for convenience stores and foodservice.

In tandem, Tyson also announced its intention to sell three "non-protein businesses": the Sara Lee frozen bakery business, Kettle (soups and sauces) and Van’s (waffles). A buyer has not yet been identified.

AdvancePierre has sales of $1.6 billion and approximately 4,500 employees. While it's a public company, funds affiliated with Oaktree Capital Management own approximately 42 percent of the company. The deal includes $3.2 billion in equity value and $1.1 billion in assumption of AdvancePierre debt. The boards of directors of both companies have approved the deal.

AdvancePierre says it offers a broad line of products across all day parts including: ready-to-eat sandwiches, including breakfast sandwiches, peanut butter and jelly sandwiches and hamburgers; sandwich components, such as fully cooked hamburger and chicken patties and Philly steaks; and other entrées and snacks, such as country-fried steak, stuffed entrées, chicken tenders and cinnamon dough bites.

Tom Hayes, Tyson president/CEO just since January, noted the acquisition's reliance on protein, its focus on convenient foods and its presence in the "fast-growing convenience and retail perimeter with solutions that span all-day parts." And Tyson long has had a goal to increase its percentage of value-added/prepared foods.

Christopher Sliva, who has been AdvancePierre's president/CEO since last November, looks forward to "leveraging Tyson’s existing distribution infrastructure and go-to-market capabilities."

Meanwhile, Tyson is "exploring" the sale of Sara Lee frozen, Kettle and Van’s. "With our protein-focused strategy, we believe other companies may be better positioned to unlock their value over time,” said Hayes.

Any sale would include the Chef Pierre, Bistro Collection, Kettle Creations and Van’s brands, a license to use the Sara Lee brand in various channels, as well as the company’s Tarboro, N.C., Fort Worth, Texas, and Traverse City, Mich., prepared foods facilities.

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