Hillshire Brands is bringing Pinnacle Foods under its umbrella today. The company that specializes in meats now has frozen food, syrup and more thanks to a purchase of 6.6 billion. That is a lot of meat. This buyout is making Hillshire a definite force in the food industry. Not only will they have Jimmy Dean and Hillshire brand meats, but Birds Eyes, Vlasic, and Mrs. Butterworth are all now under the same business roof, according to CNN on May 12.
What will this merger mean in the long run for Hillshire? It will take them up the food chain at your local grocery store. Right now, Hillshire is ranked seventh when it comes to frozen foods, and this will bring them up to the third spot. Hillshire will have three brands that manage to bring in $1 billion in sales each year. Those brands are Hillshire Farm, Jimmy Dean, and Birds Eye. Birds Eye is from Pinnacle Foods.Hillshire will now have 10 brands that rank at number one or number two in their respective categories.
One would think that a purchase like this would boost up the stock of Hillshire Farm on Monday, but stock for the company actually fell $5.10 after the buyout was announced. Pinnacle did see their stock price rise following the announcement of the news. Their stock jumped up 15 percent. Sean Connolly, the CEO of Hillshire, said the following about the buyout on Monday, according to the Chicago Tribune: "These portfolios complement one another."
Half of Pinnacle Foods is currently owned by Blackstone LP, and they have already said they will agree to the deal for this sale. This sale will take until September to complete. Connolly is not yet sure if this buyout will cost jobs or force plants of either company to close. That will need to be evaluated over the months ahead. Many had thought in the business that Hillshire would be the company bought out by a competitor, but instead Hillshire Brands has taken the leap and reached out to take its own future in its hands.
If you go into your kitchen right now, you will surely find at least one item that is included in this buy out today. Whether it be that Jimmy Dean sauce or a treat from Sara Lee, Hillshire has made it so that they become a strong presence in the kitchens of homes across the United States.
What do you think of this move by Hillshire Brands? Do you have their items in your refrigerator right now? Share you thoughts below.