The agreement to acquire Snack Factory was announced on Sept. 5 and was expected to be concluded early in the fourth quarter of 2012. The purchase price was $340 million in cash, which included about $60 million in net future tax benefits.
Snack Factory manufactures Pretzel Crisps, which are thin, flat crackers sold nationally by leading retailers, particularly in the deli-bakery sections of grocery stores.
“We are excited about the opportunity to add the Snack Factory family of products to our growing portfolio of outstanding snack food brands,” said David V. Singer, chief executive officer of Snyder’s-Lance. “The team at Snack Factory has done an amazing job of developing such a successful brand with a loyal following. We look forward to bringing together our collective strengths as Snyder’s-Lance continues to build an even stronger snacks food company.”
Snyder’s-Lance indicated it expected its acquisition of Snack Factory would add approximately $160 million to the company’s estimated 2013 net revenues.
Prior to the Snack Factory purchase, Snyder’s-Lance, Inc. in June acquired substantially all the assets of O’Byrne Distributing, Inc., a snack food distributor serving the Augusta, Ga., area. O’Byrne operates a D.S.D. distribution system and distributes Snyder’s-Lance Inc.’s branded products as well as several additional partner-brand product lines.
Snyder’s-Lance itself was formed in December 2010 from the merger of Snyder’s of Hanover, a leader in pretzels and salty snacks, and Lance, Inc., a manufacturer of sandwich crackers, potato chips and cookies. The combined company has manufacturing facilities in North Carolina, Pennsylvania, Iowa, Indiana, Georgia, Florida, Ohio and Ontario. Its principal brands include Snyder’s of Hanover, Lance, Cape Cod, Krunchers, Tom’s, Archway, Jay’s, Stella D’oro, O-Ke-Doke and Grande. It also has a number of private label and third-party brands.
Innovation also is an important part of Snyder’s-Lance business, and to that end the company in February unveiled plans to build a 60,000-square-foot research and development center in Hanover, Pa.
The center will research, develop and enhance new and existing products, and the project is expected to be completed in the fourth quarter of 2012. The facility will have a LEED Silver Certification.
On the other end of the spectrum, Snyder’s-Lance closed a salty snacks manufacturing facility in Corsicana, Texas. The company said a review of its total manufacturing network determined that closing the Corsicana facility was necessary to reduce operating costs while consolidating production into other manufacturing locations.
Net income during the first half of 2012 was $33,790,000, or 49c a share, compared with $7,337,000, or 10c a share, in January-June 2011. Sales in the half aggregated $792,243,000, down $8,768,000, or 1%, from $801,011,000 in January-June 2011.