Smucker to explore options for U.S. baking business

by Eric Schroeder
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Smucker's review includes its U.S. baking business that primarily encompasses products sold in U.S. retail channels under the Pillsbury, Martha White, Hungry Jack, White Lily and Jim Dandy brands.
 

ORRVILLE, OHIO — J.M. Smucker Co. has announced it is exploring strategic options for its U.S. baking business, including a potential sale. The announcement comes nearly a month after reports surfaced suggesting the Orrville-based maker of Pillsbury and Martha White brands may be considering such a move.

Smucker said the review includes its U.S. baking business that primarily encompasses products sold in U.S. retail channels under the Pillsbury, Martha White, Hungry Jack, White Lily and Jim Dandy brands, along with all relevant trademarks and licensing agreements. The review also includes the company’s manufacturing facility in Toledo, Ohio.

Additionally, Smucker holds a 20-year, perpetually renewable, royalty-free license for the use of the Pillsbury brand name and related trademarks, which is transferable at the company’s discretion.

Smucker said its baking business in Canada, which primarily includes products sold under the Carnation, Eagle Brand, Five Roses, Golden Temple and Robin Hood brands, is not included in the review.

“We regularly review our portfolio to ensure it aligns with our strategic priorities,” said Mark Smucker, chief executive officer. “Pillsbury, Hungry Jack and Martha White remain iconic brands, and this well-run business has been a solid contributor to our financial performance over the years. However, our current strategic priorities include an increased emphasis and allocation of resources toward growing our coffee, pet, and snacking food businesses.”

The company’s U.S. baking brands are expected to generate sales of approximately $370 million in the year ended April 30, 2018. In the March 7 report from Bloomberg, people familiar with the situation indicated the unit could attract a purchase price of around $700 million.

Smucker acquired the baking brands as part of its 2004 acquisition of International Multifoods Corp.

News of Smucker’s plans to explore strategic options for its U.S. baking business came on the same day the company agreed to acquire Meadville, Pa.-based Ainsworth Pet Nutrition, L.L.C. in a transaction valued at approximately $1.7 billion. Ainsworth produces, distributes and markets pet food and pet snacks, primarily in the United States. 
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