Dive Brief:
- The board of directors of Hillshire Brands no longer recommends that the company purchase Pinnacle Foods Inc., maker of Vlasic pickles, Aunt Jemima pancake mixes, and Wish Bone salad dressings.
- The board's move was necessary in order to allow Tyson Foods to acquire Hillshire. Tyson's takeover offer for Hillshire is contingent upon the termination of the Pinnacle purchase.
- Now the ball is in Pinnacle's court. The company can cancel the deal now and collect a fee of $163 million. Or it can insist that Hillshire hold a shareholder vote -- thus delaying the Tyson deal and giving Pinnacle the opportunity to negotiate an even higher termination fee.
Dive Insight:
As we noted earlier, hell hath no fury like a suitor scorned. And there's nothing in the news of the Hillshire board's decision to make one think that this will end amicably.
We still expect Pinnacle to walk out with more than $163 million. Because despite all the emotion attached to the failed deal, "It's not personal. It's strictly business."