Parsippany, N.J.-based B&G Foods (NYSE: BGS ) is taking control of Robert's American Gourmet Food, LLC -- the company that does business as "Pirate Brands" and whose signature product is probably the Pirate Booty corn puffs snack.
In a press release issued on Monday, B&G announced that it is buying the "all-natural" snack foods maker from private equity funds VMG Partners and Driven Capital Management, as well as owner-founder Robert Ehrlich "and certain other entities and individuals." B&G will pay approximately $195 million in cash.
The purchase price works out to somewhere between 2.2 and 2.3 times the $80 million to $90 million in sales that Pirate Brands is expected to haul in this year, suggesting a small discount to B&G's own 2.4-times-sales valuation. Additionally, B&G CEO David L. Wenner noted that he expects "the acquisition to be immediately accretive to our earnings per share and free cash flow."
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Investors seem to like the deal, bidding up B&G shares 6.8% in Monday trading to close at $31.17.
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