Dive Brief:
- Del Monte Pacific has secured two loans, totaling more than a half-billion dollars, to fund the acquisition of U.S.-based Del Monte Foods.
- Philippines-based Del Monte Pacific said it would take out a bridge loan for $350 million and a term loan for $165 million as it seeks to take control of its U.S. namesake, which is the No. 1 brand in canned fruits and vegetables in America.
- Del Monte Pacific also disclosed it is in talks with unnamed investors who would invest $74.5 million in the company.
Dive Insight:
As we've noted before, Del Monte Pacific is getting Del Monte Foods at a reasonable price. But that may not be enough to make this deal work. Our concern is that Del Monte Foods' brand has suffered substantial damage. Plus there's no denying that American's taste for canned fruit and vegetables is fading. The only thing we can think of that would make such an acquisition riskier is taking on a half billion in debt to pay for it.
