by Lance Turner
Posted 1/3/2013 07:15 am
Updated 2 years ago
Unilever United States Inc. of Englewood Cliffs, N.J., said Thursday that it has signed a definitive agreement to sell its global Skippy business to Hormel Foods Corp. of Austin, Minn., for about $700 million.
The deal includes Unilever's Skippy manufacturing facilities in Little Rock and Weifang, China, in the Shandong province.
In a statement to Arkansas Business, Hormel said it "intends to maintain current operations at the plant in Little Rock." The company said it will keep current operations "as is."
The Little Rock plant has 153 employees. The Weifang plant employs 166, Hormel said.
The Little Rock plant, which makes Skippy peanut butter at 8201 Frazier Pike in Little Rock, is the only Skippy peanut butter plant left in the country. According to the company, production began in Little Rock on June 20, 1977.
"Skippy is an iconic brand with presence all around the world," Kees Kruythoff, president of Unilever North America, said in a news release. "As we continue to sharpen our portfolio to deliver sustainable growth for Unilever, we believe that the potential of the Skippy brand can now be more fully realized with Hormel Foods."
Skippy said its annual sales are about $370 million, about $100 million of which are outside the United States. Hormel said Skippy, first introduced in 1932, is the leading peanut butter brand in China and is sold in more than 30 other countries on five continents.
The deal is subject to regulatory approval and other closing conditions and is expected to close early in 2013.
Unilever had previously sold its Bertolli and P.F. Chang's Home Menu frozen meal business to ConAgra in a $260 million.
Unilever, based in the Netherlands and the U.K., is one of the largest consumer products companies in the world. It makes Vaseline, Dove soaps and Lipton tea. The company had indicated last year it was considering selling Skippy as part of a strategic review.
According to Thomson Reuters data cited by the New York Times' DealBook blog, the acquisition is the biggest ever by Hormel.
"The acquisition of the Skippy peanut butter business represents a significant opportunity for Hormel Foods," Jeffrey M. Ettinger, Hormel's CEO, said in a news release. "It allows us to grow our branded presence in the center of the store with a nonmeat protein product and it reinforces our balanced portfolio."
(The Associated Press contributed to this report.)