J M Smucker will sell its Crisco business to peer B&G Foods in an all-cash deal valued at about $550 million (€465.2 million), as it focuses on pet food, coffee and snacks, the companies said.
J M Smucker, which is looking to exit the U.S. baking category, said the deal also includes its oils and shortening business outside the United States.
"Crisco is an iconic brand that is beloved by consumers, and the business has been a solid contributor to our financial performance," said Mark Smucker, president and chief executive, The J.M. Smucker Co.
"However, our strategic priorities include an increased focus and allocation of resources toward pet food and pet snacks, coffee, and snacking to maintain momentum in these categories. Today's announcement helps position the company to further grow our core businesses and unlock value for our shareholders."
The transaction is expected to close in the third quarter of the company's 2021 fiscal year, subject to customary closing conditions, including receipt of required regulatory approvals.
The Orrville, Ohio-based company, known for its jelly and beverages, expects the divestiture to cut its annual adjusted earnings per share by 45 cents to 55 cents.