May 12 - Hillshire is diversifying its product lineup beyond packaged meats through acquisitions. Last month, it bought Van's Natural Foods. Fred Katayama reports.
Hillshire Brands is developing a sweet tooth. The maker of Jimmy Dean sausages and Ball Park hot dogs is buying Pinnacle Foods, adding Duncan Hines cake mixes, Log Cabin syrup, and Mrs. Paul's frozen seafood to its lineup. Hillshire will pay $6.6 billion in cash and stock; that amount includes debt. The move comes just one month after it expanded its breakfast lineup with pancakes and waffles by purchasing Van's Natural Foods. Meat product producers like Hillshire and Hormel have been adding non-meat products to their cart through acquisitions. In January, Tyson Foods bought frozen pizza maker Bosco's Pizza. And last year, SPAM maker Hormel bought Skippy peanut butter from Unilever. Hillshire is paying a 20 percent premium for Pinnacle. Investors gobbled up shares of Pinnacle, sending them higher at the start of trade while Hillshire fell.