Korea's CJ CheilJedang brings Bain into Schwan's deal
Korean consumer conglomerate CJ CheilJedang Corporation has agreed to sell a 27% stake in CJ Foods America – a vehicle established for the acquisition of US frozen foods provider Schwan’s – to Bain Capital for $320 million.
The $1.84 billion Schwan's purchase, which closed in February, represents CJ CheilJedang's largest-ever overseas acquisition. It is intended to serve as a foothold in the US, strengthening the company's manufacturing and distribution capabilities as well as its R&D efforts. Schwan's is best known for pizza brands such as Red Baron, Freschetta, MaMa Rosa's and Tony's.
The plan is to list CJ Foods America within three years, and Bain has a drag-along right to pursue a trade sale if this target is not met, according to a filing.
CJ CheilJedang, which generated KRW29.5 trillion ($24.8 billion) in sales last year, started out in the 1950s as a sugar producer and now has business lines covering instant noodles and dumplings, meat and fish products processing, sauces and seasonings, health foods, and snacks. It also has a food biotechnology operation that develops new ingredients.
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