Campbell Soup Company has announced its acquisition of Sovos Brands, Inc., based in Louisville, Colorado, in a deal valued at approximately $2.7 billion. Sovos Brands is a well-known manufacturer of a variety of food products, including sauces, yogurts, and frozen prepared foods. Some of its prominent brands include Rao’s, noosa, and Michael Angelo’s.
Mark Clouse, President and CEO of Campbell Soup, expressed his enthusiasm for the acquisition, highlighting how it aligns with the company’s strategic focus. He noted that the move is in line with their strategy of concentrating on specific geographies, divisions, and key categories that they are well-versed in. Clouse emphasized Campbell Soup’s readiness to integrate Sovos Brands into their operations, leveraging their past progress and strong financial performance.
The acquisition is subject to Sovos Brands stockholder approval and standard closing conditions, including regulatory clearance. The anticipated closing date for the transaction is expected to be by the end of December. Both companies’ boards of directors have given their approval for the deal.
In the fiscal year 2022, Sovos Brands achieved sales totaling $878.4 million, with its flagship Rao’s brand contributing significantly with $580.1 million in sales. The company had expanded the Rao’s brand into additional categories, including frozen entrees, pizza, pasta, and soups. The first half of fiscal 2023 saw Sovos Brands reporting improved financial performance, with net income of $13.2 million compared to a loss of $26.2 million in the same period the previous year. First-half sales for fiscal 2023 reached $470.4 million, up from $407.4 million in the prior year.
Todd Lachman, President and CEO of Sovos Brands, expressed his pride in the growth and success of the company, attributing it to the hard work and dedication of the Sovos Brands team. Lachman highlighted the anticipated value that the transaction will bring to Sovos Brands’ shareholders, pointing out a significant increase from their 2021 IPO price. He expressed confidence in Campbell Soup’s ability to continue expanding the reach of Sovos Brands’ products and building on their track record of growth and achievement.
The acquisition of Sovos Brands represents a strategic move by Campbell Soup to further strengthen its portfolio and expand its presence in the food industry.