CHARLOTTE, N.C. (AP) — Snyder's-Lance Inc. said Wednesday that it plans to buy cracker maker Snack Factory LLC for $340 million in cash to expand into the deli-bakery snack business.
The company expects the deal to close in the fourth quarter. It anticipates the acquisition will add 2 cents per share in its 2012 fiscal year and 10 cents per share in 2013. Snyder's also thinks the purchase will boost its revenue by $160 million in 2013.
Snyder's, based in Charlotte, N.C., makes a variety of chips, cookies, tortilla chips and other snacks. Snack Factory, based in Princeton, N.J., makes Pretzel crisps, a flat pretzel-shaped cracker.
Shares of Snyder's rose 4 cents to close at $22.50.
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NEW YORK (AP) — Shares of Snyder's-Lance Inc. soared Thursday after the company said it would buy Snack Factory LLC for $340 million in a cash deal to expand into the deli-bakery business.
THE SPARK: Snyder's, based in Charlotte, N.C., makes chips, cookies, tortilla chips and other snacks. Snack Factory, based in Princeton, N.J., makes Pretzel Crisps, a flat pretzel-shaped cracker.
Snyder's said it expects the deal to close in the fourth quarter. It anticipates the acquisition will add 2 cents per share in its 2012 fiscal year and 10 cents per share in 2013. Snyder's also thinks the purchase will boost its revenue by $160 million in 2013.
THE BIG PICTURE: Akshay Jagdale, a KeyBanc Capital Markets analyst, upgraded his rating on the company to "Buy" and initiated a $27 price target, noting that the deal is expected to add to earnings in less than a quarter.
Jagdale said the "fastest and most efficient path to value creation" for Snyder's will be through acquisitions, rather than organic growth. Jagdale said the Snack Factory deal was the first step toward unlocking some of the long-term value for Snyder's shareholders.
SHARE MOVEMENT: Shares of Snyder's were up 11 percent at $24.99.
