8-K
B&G Foods, Inc. (BGS)
As filed with the Securities and Exchange Commission on December 1, 2020
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): December 1, 2020
| B&G Foods, Inc. | ||
|---|---|---|
| (Exact name of Registrant as specified in its charter) | ||
| Delaware | 001-32316 | 13-3918742 |
| --- | --- | --- |
| (State or Other Jurisdiction | (Commission | (IRS Employer |
| of Incorporation) | File Number) | Identification No.) |
| Four Gatehall Drive, Parsippany,New Jersey | 07054 | |
| --- | --- | |
| (Address of Principal Executive Offices) | (Zip Code) |
Registrant’s telephone number, including area code: (
973) 401-6500
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered |
|---|---|---|
| Common Stock, par value $0.01 per share | BGS | New York Stock Exchange |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Item 2.01. Completion of Acquisition or Disposition of Assets.
On December 1, 2020, B&G Foods, Inc., through two of its wholly owned subsidiaries, B&G Foods North America, Inc. and B&G Foods Canada, ULC, closed on the acquisition of the Crisco brand oils and shortening business from The J. M. Smucker Company for a purchase price of $550 million in cash, subject to a customary adjustment based upon inventory at closing, pursuant to an asset purchase agreement. The purchased assets include a manufacturing facility and warehouse in Cincinnati, Ohio; inventory; supply, sales and other agreements; intellectual property, including trademarks, patents, trade secrets, know-how and licensing agreements; and marketing materials, customer lists and sales information. As described in B&G Foods’ Current Report on Form 8-K filed on October 27, 2020, the asset purchase agreement contains customary representations, warranties, covenants and indemnification provisions, except that Smucker’s obligation to indemnify B&G Foods for breaches of the representations and warranties contained in the asset purchase agreement is limited to breaches of certain fundamental representations, as defined in the asset purchase agreement. In connection with its entry into the asset purchase agreement, B&G Foods bound a customary representations and warranties insurance policy as recourse for certain losses arising out of a breach of the representations and warranties of Smucker contained in the asset purchase agreement. The representations and warranties policy is subject to certain policy limits, exclusions, deductibles and other terms and conditions. The asset purchase agreement includes an agreement for Smucker to provide certain transition services associated with the acquired business for up to nine to twelve months following closing.
Prior to the closing of the acquisition, neither B&G Foods nor any of its affiliates, or any director or officer of B&G Foods or any of its affiliates, or any associate of any such director or officer, had any material relationship with Smucker. The terms of the asset purchase agreement, including the purchase price, were determined by arm’s length negotiations between B&G Foods and Smucker.
B&G Foods funded the acquisition and related fees and expenses with cash on hand and revolving loans under its existing credit facility.
The asset purchase agreement was filed as Exhibit 2.1 under Item 1.01 to the Current Report on Form 8-K filed by B&G Foods on October 27, 2020.
Item 7.01. Regulation FD Disclosure.
On December 1, 2020, B&G Foods issued a press release to announce the closing of the acquisition described above. The information contained in the press release, which is attached to this report as Exhibit 99.1, is incorporated by reference herein and is furnished pursuant to Item 7.01, “Regulation FD Disclosure.”
Item 9.01. Financial Statements and Exhibits.
(a) FinancialStatements of Businesses Acquired.
B&G Foods intends to file financial statements of the business acquired for the periods specified in Rule 3-05(b) of Regulation S-X within the time period permitted by Item 9.01 of Form 8-K.
(b) ProForma Financial Information.
B&G Foods intends to file the pro forma financial information required pursuant to Article 11 of Regulation S-X within the time period permitted by Item 9.01 of Form 8-K.
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(d) Exhibits.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| B&G FOODS, INC. | |||
|---|---|---|---|
| Dated: December 1, 2020 | By: | /s/ Scott E. Lerner | |
| Scott E. Lerner | |||
| Executive Vice President, | |||
| General Counsel and Secretary |
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Exhibit 99.1
B&G Foods Completes Acquisition ofIconic Crisco^®^ Brand
Parsippany, N.J., December 1, 2020—B&G Foods, Inc. (NYSE: BGS) announced that effective today it has completed the acquisition of the iconic Crisco brand of oils and shortening from The J. M. Smucker Co. for $550 million in cash, subject to a customary adjustment based upon inventory at closing. As part of the acquisition, B&G Foods also acquired a manufacturing facility and warehouse in Cincinnati, Ohio.
B&G Foods expects the acquisition to be immediately accretive to its earnings per share and free cash flow. B&G Foods projects that in 2021, the acquired business will continue to benefit from increased demand due to the COVID-19 pandemic and generate annual net sales of approximately $270 million, adjusted EBITDA in the range of $65 million to $70 million and adjusted diluted earnings per share in the range of $0.45 to $0.50. Because the acquisition was structured as an asset purchase, B&G Foods expects to realize approximately $75 million in tax benefits on a net present value basis. At the midpoint of B&G Foods’ 2021 projected adjusted EBITDA for the business, the acquisition represents a purchase price multiple of approximately 8.1 times adjusted EBITDA (or 7.0 times adjusted EBITDA net of expected tax benefits).
Crisco is the original all-vegetable shortening that transformed the way people bake and cook over 100 years ago. Crisco is the number one brand of shortening, the number one brand of vegetable oil and also holds a leadership position in other cooking oils and cooking sprays.
B&G Foods funded the acquisition and related fees and expenses with cash on hand and revolving loans under its existing credit facility.
About B&G Foods, Inc.
Based in Parsippany, New Jersey, B&G Foods and its subsidiaries manufacture, sell and distribute high-quality, branded shelf-stable and frozen foods across the United States, Canada and Puerto Rico. With B&G Foods’ diverse portfolio of more than 50 brands you know and love, including Back toNature, B&G, B&M, Cream of Wheat, Dash, Green Giant, Las Palmas, Le Sueur, Mama Mary’s, Maple Grove Farms, New York Style, Ortega, Polaner, Spice Islands and Victoria, there’s a little something for everyone. For more information about B&G Foods and its brands, please visit www.bgfoods.com.
About Non-GAAP Financial Measures and Items Affecting Comparability
“Adjusted diluted earnings per share” (diluted earnings per share adjusted for certain items that affect comparability, including cash and non-cash acquisition/divestiture-related expenses, gains and losses (which may include third party fees and expenses, integration, restructuring and consolidation expenses and amortization of acquired inventory fair value step-up)); “EBITDA” (net income before net interest expense, income taxes, depreciation and amortization and loss on extinguishment of debt), and “adjusted EBITDA” (EBITDA as adjusted for cash and non-cash acquisition/divestiture-related expenses, gains and losses (which may include third party fees and expenses, integration, restructuring and consolidation expenses, amortization of acquired inventory fair value step-up and gains and losses on the sale of assets), non-recurring expenses and certain other items described from time to time in the Company’s SEC filings and earnings releases) are “non-GAAP financial measures.” A non-GAAP financial measure is a numerical measure of financial performance that excludes or includes amounts so as to be different than the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles in the United States (GAAP) in B&G Foods’ consolidated balance sheets and related consolidated statements of operations, comprehensive income, changes in stockholders’ equity and cash flows. Non-GAAP financial measures should not be considered in isolation or as a substitute for the most directly comparable GAAP measures. The Company’s non-GAAP financial measures may be different from non-GAAP financial measures used by other companies.
B&G Foods provides earnings guidance only on a non-GAAP basis and does not provide a reconciliation of the Company’s forward-looking adjusted EBITDA and adjusted diluted earnings per share guidance to the most directly comparable GAAP financial measures because of the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliations, including deferred taxes; loss on extinguishment of debt; adjustments that could be made for acquisition/divestiture-related expenses, gains and losses and other charges reflected in the Company’s reconciliation of historic non-GAAP financial measures, the amounts of which, based on past experience, could be material.
Forward-Looking Statements
Statements in this press release that are not statementsof historical or current fact constitute “forward-looking statements.” The forward-looking statements contained inthis press release include, without limitation, statements related to the expected impact of the acquisition, including withoutlimitation, the expected impact on B&G Foods’ earnings per share, net sales, adjusted EBITDA, adjusted diluted earningsper share and free cash flow, and the expected tax benefits of the acquisition. Such forward-looking statements involveknown and unknown risks, uncertainties and other unknown factors that could cause the actual results of B&G Foods to bematerially different from the historical results or from any future results expressed or implied by such forward-looking statements.In addition to statements that explicitly describe such risks and uncertainties readers are urged to consider statements labeledwith the terms “believes,” “belief,” “expects,” “projects,” “intends,” “anticipates,” “assumes,” “could,” “should,” “estimates,” “potential,” “seek,” “predict,” “may,” “will,” or “plans” and similar referencesto future periods to be uncertain and forward-looking. Factors that may affect actual results include, without limitation: whetherand when the Company will be able to realize the expected financial results and accretive effect of the acquisition, and how customers,competitors, suppliers and employees will react to the acquisition; the impact of the COVID-19 pandemic on the Company’sbusiness, including, without limitation, the ability of the Company and its supply chain partners to continue to operate manufacturingfacilities, distribution centers and other work locations without material disruption; the Company’s substantial leverage;the effects of rising costs for the Company’s raw materials, packaging and ingredients; crude oil prices and their impacton distribution, packaging and energy costs; the Company’s ability to successfully implement sales price increases and costsaving measures to offset any cost increases; intense competition, changes in consumer preferences, demand for the Company’sproducts and local economic and market conditions; the Company’s continued ability to promote brand equity successfully,to anticipate and respond to new consumer trends, to develop new products and markets, to broaden brand portfolios in order tocompete effectively with lower priced products and in markets that are consolidating at the retail and manufacturing levels andto improve productivity; the risks associated with the expansion of the Company’s business; the Company’s possibleinability to identify new acquisitions or to integrate recent or future acquisitions or the Company’s failure to realizeanticipated revenue enhancements, cost savings or other synergies; tax reform and legislation, including the effects of the U.S.Tax Cuts and Jobs Act and the U.S. CARES Act; the Company’s ability to access the credit markets and the Company’sborrowing costs and credit ratings, which may be influenced by credit markets generally and the credit ratings of the Company’scompetitors; unanticipated expenses, including, without limitation, litigation or legal settlement expenses; the effects of currencymovements of the Canadian dollar and the Mexican peso as compared to the U.S. dollar; the effects of international trade disputes,tariffs, quotas, and other import or export restrictions on the Company’s international procurement, sales and operations;future impairments of the Company’s goodwill and intangible assets; the Company’s ability to successfully completethe implementation of additional modules and the integration and operation of a new enterprise resource planning (ERP) system;the Company’s ability to protect information systems against, or effectively respond to, a cybersecurity incident or otherdisruption; the Company’s sustainability initiatives and changes to environmental laws and regulations; and other factorsthat affect the food industry generally. The forward-looking statements contained herein are also subject generally to other risksand uncertainties that are described from time to time in B&G Foods’ filings with the Securities and Exchange Commission,including under Item 1A, “Risk Factors” in the Company’s Annual Report on Form 10-K for fiscal 2019filed on February 26, 2020 and in its subsequent reports on Forms 10-Q and 8-K. Investors are cautioned not to place unduereliance on any such forward-looking statements, which speak only as of the date they are made. B&G Foods undertakes noobligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events orotherwise.
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| Contacts: | |
|---|---|
| Investor Relations: | Media Relations: |
| ICR, Inc. | ICR, Inc. |
| Dara Dierks | Matt Lindberg |
| 866.211.8151 | 203.682.8214 |
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