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Post Holdings to Buy Perfection Pet Foods for $235 Million

The acquisition will allow Post Holdings to insource a portion of its current pet food business and gain an entry point into the private-label and co-manufacturing pet food categories.

Post Holdings Perfection Pet Foods

Post Holdings has agreed to acquire the assets of Perfection Pet Foods, a leading manufacturer and packager of private-label and co-manufactured pet food and baked treat products, for $235 million. The transaction includes a baked plant containing two 240-ft long biscuit ovens and two packaging lines that have an annual capacity of 23,000 tons and a 150,000-sq-ft kibble facility with three extruders, six packaging lines, and a 165,000-ton annual capacity. Both sites are located in Visalia, Calif.

The two facilities will provide Post Holdings with additional manufacturing capacity to insource a portion of its current pet food business and an entry point into the private label and co-manufacturing pet food categories. The acquisition is expected to be complete by the end of this year, subject to customary closing conditions.


   Post Holdings Unit Planning $146 Million Facility Expansion


Perfection Pet Foods offers retailers and brand owners contract manufacturing services, producing non-grain pet food, mass consumer private-label products, liquid and dry flavor applications, oven-baked recipes, limited ingredient diet formulas, and organic formulas.

Inclusive of stand-up costs, Post Holdings expects Perfection Pet Foods to contribute approximately $25 million of Adjusted EBITDA in the first 12 months after the close of the acquisition. Post also projects that the acquisition will result in a tax benefit to Post Holdings with a net present value of approximately $20 million and reduce future capital expenditures previously earmarked for capacity expansion.

Adjusted EBITDA represents earnings before interest, income taxes, depreciation and amortization, and other adjustments. Adjusted EBITDA is not prepared in accordance with U.S. GAAP, as it excludes certain items, and may not be comparable to a similarly titled measure of other companies.


 


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