Post closes takeover of pasta maker Dakota Growers

Post Holdings, the parent of Post Foods and a manufacturer of ready-to-eat cereals, has closed the acquisition of private-label pasta firm Dakota Growers Pasta Company in an all-cash deal of $370m.

Dakota Growers, located in Carrington, North Dakota, US, has durum wheat milling and pasta production capabilities in the region, as well as in New Hope, Minnesota.

The privately-held pasta firm has a strong presence in the North American pasta market, with leadership positions in the private-label retail, foodservice and ingredient channels.

The definitive agreement to acquire Dakota Growers was signed with Viterra, a wholly-owned subsidiary of Glencore Xstrata, in September 2013.

Post chairman and CEO William P Stiritz said at the time, "With Dakota Growers, Post continues to expand its portfolio into segments of the overall food industry where it sees opportunities to grow and diversify its strong cash flow."

As part of the deal, Post agreed to acquire all of the outstanding stock of Agricore United Holdings, the parent company of Dakota Growers.

The company financed the transaction through a combination of cash on hand and about $200m in debt financing.

Dakota Growers’ business will be independently operated from other Post Holdings businesses by its existing management team led by vice president and general manager Ed Irion.

Post expects the acquired entity to contribute an approximate $300m to net revenues and about $42m-$46m in EBITDA.

In recent years, the company has been strengthening its presence across various segments – in December, it signed separate deals to acquire Golden Boy Foods and Dymatize Enterprises for approximately $680m.

In September, Post completed the acquisition of Premier Nutrition (PNC), a producer of protein beverages, foods and nutritional supplements for $180m.