Hershey Co. on Dec. 18 announced an agreement to acquire Amplify Snack Brands Inc., owner of the SkinnyPop brand of popcorn, for approximately $1.6 billion.
It's a big step out of the candy category for Hershey, but not the company's first. Hershey in 2015 acquired jerky maker Krave.
Amplify began with the single but fast-growing popcorn brand SkinnyPop in 2010, and originally was called SkinnyPop Popcorn LLC. In 2014, the company was acquired by investment funds affiliated with private equity firm TA Associates, which helped it engineer three acquisitions in two years: Paqui LLC in 2015 and both Tyrrells Group and Boundless Nutrition LLC in 2016. It went public in August 2015 at $18 per share and later held a secondary offering at $11.25 per share; Hershey is paying $12 per share.
Amplify reported sales of $283 million in the first nine months of 2017, an increase of 55% year-over-year. Gross profit was $110 million and net income was $2.4 million.
The agreement has been approved by the boards of directors of both companies, plus affiliates of TA Associates, still Amplify's largest stockholder, and key Amplify insiders, who collectively represent approximately 57% of the outstanding shares.
"The acquisition of Amplify and its product portfolio is an important step in our journey to becoming an innovative snacking powerhouse, as together it will enable us to bring scale and category management capabilities to a key sub-segment of the warehouse snack aisle," said Michele Buck, Hershey's president/CEO. "Hershey's snack mix and meat snacks products, combined with Amplify's Skinny Pop, Tyrrells, Oatmega, Paqui and other international brands, will allow us to capture more consumer snacking occasions by creating a broader portfolio of brands."
The deal is expected to close in the first quarter of 2018.