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03/2015

Big Heart Pet Brands acquired by The J.M. Smucker Company

UNITED STATES Food Processing / Petfood EV 3b - 100b USD

Context

The J. M. Smucker Company announced in February 2015 that it had entered into a definitive agreement to acquire Big Heart Pet Brands, a leading U.S. producer and marketer of branded pet food and pet snacks. The transaction represented a major strategic expansion for Smucker, giving the company an immediate position in the large and growing pet food category and adding a new platform to its existing food and beverage operations. The transaction was structured as a combination of cash and stock and included the assumption of Big Heart Pet Brands’ net debt, with an enterprise value of approximately . Big Heart Pet Brands was generating approximately in net sales and in adjusted EBITDA at the time of the transaction. The strategic rationale was primarily focused on portfolio diversification and category expansion rather than geographic consolidation. By acquiring Big Heart Pet Brands, Smucker gained exposure to a complementary consumer category with established brands and a strong position in pet snacks and specialty pet retail. The transaction also enabled Smucker to leverage its existing capabilities in brand management, manufacturing, distribution and consumer marketing across a new product segment. For Big Heart Pet Brands’ shareholders, the deal provided an exit following a strategic review conducted by the company’s board and enabled the business to join a larger consumer packaged goods platform. Following completion, Big Heart Pet Brands was integrated as Smucker’s third major growth platform alongside its established food and beverage activities. The transaction was expected to generate significant operational synergies through the combination of procurement, manufacturing, distribution and corporate functions, while allowing the enlarged group to expand the reach of Big Heart’s brands. Dave West, Big Heart Pet Brands’ former CEO, joined Smucker to lead the pet food and snacks business, supporting management continuity and the integration of the acquired operations. The acquisition was subsequently completed in March 2015, subject to customary regulatory and closing conditions. The transaction strengthened Smucker’s presence in North American consumer packaged goods and established pet food and snacks as an additional long-term growth driver for the group.

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Target

Big Heart Pet Brands manufactures, markets, and distributes branded pet food and pet snacks across North America from its headquarters in San Francisco, California. Formed through the strategic repositioning of Del Monte Corporation following the divestiture of its consumer foods and canned vegetable operations, the company operates as a dedicated producer of canine and feline nutrition. Its brand portfolio spans established household consumer labels including Meow Mix, Milk-Bone, Kibbles 'n Bits, 9Lives, Natural Balance, Pup-Peroni, Gravy Train, Nature's Recipe, Canine Carry Outs, and Milo's Kitchen. The organization relies on an integrated manufacturing footprint with dedicated production facilities located in Alabama, Kansas, New York, and Pennsylvania, supported by specialized research and development centers and distribution hubs. Its commercial model serves standard grocery retailers, mass merchandisers, club stores, and specialized pet trade channels, delivering staple pet nutrition and premium snack products directly to consumer households.

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2015
2014

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REFERENCES

Valuation range: EV 3b - 100b USD

Revenue range: 1b - 3b USD

EBITDA range: 250M - 500M USD

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Authors: verified mynth contributor (mynth data is contributed by M&A / PE professionals and systematically cross-verified with private deal documents and official press releases).

Press release: view release

Acquirer: the j.m. smucker company