Hershey Announces Intent to Acquire Dot's Homestyle Pretzels and Pretzels Inc.
The Hershey Company (NYSE: HSY) has announced a definitive agreement to acquire Dot's Pretzels LLC, a leading brand in the pretzel market, and Pretzels Inc., a co-manufacturer. The total acquisition cost is approximately $1.2 billion. Dot's Pretzels, which alone accounts for 55% of the pretzel category's growth, complements Hershey's salty snack portfolio and aims to boost its market presence. The acquisitions are expected to enhance manufacturing capabilities and are projected to be slightly accretive to earnings per share in 2023 and adjusted earnings per share in 2022.
- Acquisition expected to be slightly accretive to reported earnings per share in 2023.
- Dot's Pretzels accounts for 55% of growth in the pretzel category.
- Acquisition enhances Hershey's salty snack portfolio and market reach.
- Increased manufacturing capabilities through the acquisition of Pretzels Inc.
- Total acquisition cost of $1.2 billion, which may impact cash reserves.
HERSHEY, Pa., Nov. 10, 2021 /PRNewswire/ -- The Hershey Company (NYSE: HSY) today announced it has entered into a definitive agreement to acquire Dot's Pretzels LLC, the owner of Dot's Homestyle Pretzels, the fastest-growing scale1 brand in the pretzel category.
Dot's Pretzels are a perfect complement to Hershey's growing salty snacking portfolio and would create an opportunity to reach new consumers in new occasions, advancing Hershey's snacking powerhouse vision.
"As the fastest growing U.S. pretzel brand, Dot's Pretzels would further accelerate our success in the permissible salty snack category, along with our successful SkinnyPop and Pirate's Booty brands," said Michele Buck, The Hershey Company President and Chief Executive Officer. "With a unique range of bold, distinctive seasonings and a flavorful crunch that creates a premium pretzel experience for consumers, Dot's Pretzels stand apart from all other products in the pretzel category and represents 55 percent of the pretzel category's growth during the past year."
Created more than a decade ago in North Dakota by founder Dot Henke in her home kitchen, Dot's Pretzels started as a special family snack that she shared with family, friends and neighbors to get through long, cold North Dakota winters. Dot built her business by holding to the highest quality standards, a tradition the company proudly continues today so that each bag of Dot's Pretzels tastes as if it were made in Dot's home kitchen using her original secret formula.
"I created my pretzels to share with those people closest to me and have built the business with the idea of sharing them with everyone," said Dot. "With Hershey behind this amazing brand, I am confident that anyone who would like to enjoy these deliciously bold pretzels will have the opportunity."
Hershey Also Seeks to Expand Manufacturing Capacity and Innovation Capabilities
Hershey also announced today it has entered into a definitive agreement to acquire Pretzels Inc. from an affiliate of Peak Rock Capital, a private investment firm with numerous investments in the food and beverage industry. Pretzels Inc. is a co-manufacturer of pretzels for Dot's Pretzels and several other customers and is a leading innovator in the pretzel category. Based in Bluffton, Indiana, Pretzels Inc. operates three manufacturing locations in Indiana and Kansas. When the transactions are completed, these three manufacturing locations would be in addition to four pretzel-seasoning facilities to be acquired with Dot's. The acquisition of Pretzels Inc. would give Hershey deep pretzel category and product expertise and the manufacturing capabilities to support Dot's growth and future pretzel innovation as well as the continued growth in the entire pretzel category through Pretzels Inc.'s leading co-manufacturing capabilities.
"Pretzels Inc. will help us expand Hershey's snacking and production capabilities while keeping the special connection to Dot's," added Buck. "It will be important as we continue to grow this already fast-growing brand and create new products in the broader pretzel category."
Transaction Details
The total purchase price for these two proposed acquisitions is approximately
To learn more, please refer to our Investor Relations site at: www.thehersheycompany.com.
1Greater than
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About The Hershey Company
The Hershey Company is headquartered in Hershey, Pa., and is an industry-leading snacks company known for bringing goodness to the world through its iconic brands, remarkable people and enduring commitment to help children succeed. Hershey has approximately 17,000 employees around the world who work every day to deliver delicious, quality products. The company has more than 90 brands around the world that drive more than
For more than 125 years, Hershey has been committed to operating fairly, ethically and sustainably. Hershey founder, Milton Hershey, created the Milton Hershey School in 1909 and since then the company has focused on helping children succeed.
To learn more visit www.thehersheycompany.com
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FAQ
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