Campbell Soup Company’s recently announced acquisition of Snyder’s Lance, which owns a number of snack brands including Kettle chips, Pop Secret popcorn and Hanover pretzels, has raised some eyebrows among investors.
The purchase was funded through the sale of $5.3 B of bonds, and the nature and scale of the acquisition prompted some analysts to wonder whether it was a good deal. A report from Bloomberg notes that the deal makes Campbell’s the most indebted company in the packaged foods sector. The bonds weakened after they were sold, also suggesting the market isn’t convinced the acquisition improves Campbell’s prospects.
Campbell hopes to cut $170 M in costs by 2022 through the merger, as well as following through on cost-cutting measures already underway at Snyder’s-Lance.