ST. LOUIS, Mo. -- Ralcorp Holdings, Inc., announced that it has reached a definitive agreement to sell its branded baby food subsidiary, Beech-Nut Nutrition Corp., to The Milnot Company for $68 million in cash. Both companies are based here.
"It was a difficult decision to part with a piece of our company that has been with us since our initial spinoff from Ralston Purina, but we feel it's in the best interest of our shareholders and the Beech-Nut Company to take this step," said Joe Micheletto, CEO and president of Ralcorp Holdings. He praised Milnot as a company with "strong local roots and quality management."
Ralcorp anticipates that it will use the proceeds from the sale for stock repurchases, funding of future acquisitions, paydown of any outstanding debt and other general purposes.
Scott Meader, Milnot president and CEO, said the acquisition reflects the company's strategy to shift toward a more balanced mix of private-label and branded products. The purchase more than doubles Milnot's revenue base, from $90 million to $230 million.
Milnot, which is privately held by Madison Dearborn Partners, Inc., Chicago, manufactures branded and private label food products, including Milnot evaporated and sweetened condensed milk, Chilli Man chili, and salsa.