Posted on February 25, 2009 at 9:31 AM
Filed under: Acquisitions | Corporate Strategy | Growth Strategy
Tagged: J.M. Smuckers , Jif , P&G , Procter & Gamble

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It looks like the complex deal J.M. Smucker & Co. negotiated to buy Folgers in November 2008 is paying off for the Orville, Ohio, peanut butter and jelly maker. In announcing third-quarter earnings Wednesday, Smucker attributed a 6% jump in third-quarter sales to the Folgers' acquisition. 

Smucker acquired Folgers from Procter & Gamble Co. in a reverse Morris Trust transaction (allowing both companies to avoid taxes). P&G shareholders received a 53.5% stake in Smucker in a deal valued at about $3 billion. 

Still, peanut butter may prove a drag going forward. Smucker lowered its 2009 outlook in part due to a widely publicized salmonella outbreak and peanut butter recall. Smucker's Jif brand wasn't recalled, but the company expects consumer concerns to affect sales. - Suzanne Stevens


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