Kraft Heinz, Mondelez make the cut in Campbell Soup's international business auction: sources

By Greg Roumeliotis and Harry Brumpton (Reuters) - U.S.

Reuters December 24, 2018 00:05:06 IST
Kraft Heinz, Mondelez make the cut in Campbell Soup's international business auction: sources

Kraft Heinz Mondelez make the cut in Campbell Soups international business auction sources

By Greg Roumeliotis and Harry Brumpton

(Reuters) - U.S. food companies Kraft Heinz Co and Mondelez International Inc have been short-listed to participate in the second round of Campbell Soup Co's auction of its international business, people familiar with the matter said.

The development boosts Campbell Soup's chances of divesting its international portfolio, which includes its Australian cookie brand Arnott's and Danish baked snacks maker Kelsen Group, with one deal, two sources said on Sunday.

Both Kraft Heinz and Mondelez are interested in the assets so they can expand their global footprint. Based on the first-round bids received, Campbell Soup could fetch close to $3 billion for its international business, the sources added.

Private equity firms Bain Capital LP, KKR & Co Inc and FinTrek Capital Hong Kong Co Ltd also made the shortlist to participate in the second round of the auction for Campbell Soup's international business, according to the sources.

Nutella maker Ferrero SpA, which had previously also expressed interest in the assets, is currently in talks with Campbell Soup over whether it will remain involved in the auction process, the sources added.

Campbell Soup could wrap up the auction for its international business in the first quarter of 2019, the sources said, asking not to be identified because details of the process are confidential.

Campbell Soup, Kraft Heinz, Mondelez, Ferrero, Bain, KKR and FinTrek Capital did not immediately respond to requests for comment.

Under pressure from investors to boost its profitability and stock performance, Campbell Soup announced in August it would make preparations to divest its international portfolio as well as its "fresh" business, which includes Bolthouse Farms and Garden Fresh Gourmet.

This will allow it to reduce its $8 billion debt pile and focus on its core North American market, as well as its snacks, meals and beverages businesses. Most of the debt weighing on Campbell Soup is the legacy of its $6.1 billion acquisition in March of snack maker Snyder's-Lance Inc.

Last Thursday, Campbell Soup named Mark Clouse, the former CEO of Pinnacle Foods, as its new chief executive, in another key step in the company's efforts to regain market share and boost profits. The pick had the backing of Campbell Soup shareholder Third Point LLC.

In November, Campbell Soup settled a proxy contest against Third Point by agreeing to add two of the activist hedge fund's nominees to the food company's board, and giving the investor a say in selecting Campbell Soup's next CEO.

(Reporting by Greg Roumeliotis and Harry Bumpton in New York; Additional reporting by Richa Naidu in Chicago; Editing by Phil Berlowitz)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

France, Germany to agree to NATO role against Islamic State - sources
| Reuters
World

France, Germany to agree to NATO role against Islamic State - sources | Reuters

By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States

China's Xi says navy should become world class
| Reuters
World

China's Xi says navy should become world class | Reuters

BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.