Ho Ho Ho – is a deal in the can for Green Giant?

I am sure many people can remember particular television adverts from their childhood that evoke fond memories of either the product the ad was trying to promote or simply just the advert itself. One of my favourites, even before the days of HD and 3D televisions, was for Green Giant Sweetcorn, with the Jolly Green Giant himself reaching out from the TV screen with a handful of sweetcorn.

General Mills, the food company owner of the Green Giant frozen and canned vegetable producer, is reportedly open to offers to sell this long established business. B&G Foods, the US snack company, and Bonduelle, the French food company, appear to be the only corporate buyers being linked as possible suitors, but as you would expect a number of potential private equity firms are also being linked as possible purchasers, including Cerberus Capital Management LP and Platinum Equity LLC.

As is the norm, no one from any of the companies being linked to Green Giant will provide a denial or confirmation, but should a deal proceed between B&G and General Mills, B&G will be spending a lot more than their USD 130m acquisitions war chest (or freezer chest in this case!) that they raised via a secondary offer at the end of April this year. Having already spent a reported USD 50m on Spartan Foods of America in mid-July, sources close to the deal are valuing Green Giant at between USD 600m and USD 800m, which if it were to proceed would make this the biggest deal to date that B&G had pursued. Their previous biggest deal was their 2011 USD 325m acquisition of brands including Mrs Dash, Molly McCutter, Sugar Twin, Baker’s Joy, Static Guard and Kleen Guard from Unilever.

Acquiring the Green Giant business would certainly add even more weight to their long list of US orientated consumer brands and would also be the addition of a high profile global brand to their portfolio.