Hormel Foods acquires Unilever’s Skippy peanut butter business

US-based manufacturer and marketer of food and meat products Hormel Foods has completed the acquisition of the Skippy peanut butter business from Unilever USA, excluding business operations in China.

The acquisition includes the Little Rock, Arkansas, manufacturing facility as well as all operations worldwide, except operations in China where the deal is pending regulatory approvals.

The pending purchase of the Chinese Skippy peanut butter business is expected to be closed by the end of its fiscal 2013.

Total annual sales for the Skippy peanut butter business are expected to be about $370m, including sales of $100m from outside the US.

On 3 January 2013, Hormel Foods agreed to acquire the Skippy peanut butter business from Unilever for a cash consideration of approximately $700m.

The deal included Unilever’s Skippy manufacturing facilities in Little Rock, Arkansas, US and Weifang, China.

At the time of signing the deal, Hormel Foods chairman of the board, president and chief executive officer Jeffrey M. Ettinger said that the acquisition of the Skippy would be a significant opportunity for the company.

"It allows us to grow our branded presence in the centre of the store with a non-meat protein product and it reinforces our balanced portfolio," Ettinger said.

"The fast-growing international line will also strengthen our global presence, and should be a useful complement to our sales strategy in China for the SPAM® family of products," he added.

Introduced in 1932, Skippy is one of the major brands in the fast-growing category of natural peanut butter – a $2bn category with a 74% household penetration.

Skippy’s domestic product line includes 11 varieties of shelf-stable peanut butter products.

Globally, Skippy peanut butter is a leading brand in China and is sold in more than 30 other countries on five continents.

Based in Minnesota, Hormel Foods manufactures luncheon meat products under the Chi-Chi’s, Dinty Moore, Farmer John, Herdez, Jennie-O, Lloyd’s, SPAM and Stagg brands.