ConAgra to exit Private Brands business

7 Jul 2015

Announcing its 4Q15 financial results, ConAgra has revealed that it plans to exit its Private Brands business – less than three years after buying Ralcorp for some $5 billion in January 2013 – and is looking for a buyer. “With fiscal year 2015 now behind us, we are now pursuing a different plan to maximize […]

ConAgra to exit Private Brands business

now-selling-2398335Announcing its 4Q15 financial results, ConAgra has revealed that it plans to exit its Private Brands business – less than three years after buying Ralcorp for some $5 billion in January 2013 – and is looking for a buyer.

“With fiscal year 2015 now behind us, we are now pursuing a different plan to maximize value for our shareholders,” said Sean Connolly, chief executive officer of ConAgra Foods. “Our new plan will center on a more aggressive approach to driving margin improvement through SG&A reductions, supply chain efficiencies and other projects. It also sharpens our focus on growing our Consumer Foods andCommercial Foods segments. We expect to continually refine our portfolio with prudent divestitures and acquisitions, and there will be a strong emphasis on deploying capital in ways that benefit shareholders.”

“As I have intensely studied the situation in our Private Brands operations over the last few months, it has become clear that the time and energy the company is devoting to the Private Brands turnaround represent a suboptimal use of our resources. To prevent further distraction, we are pursuing the divestiture of our Private Brands operations. Because the outcome of our strategic review for the Private Brands operations will influence our long-term financial outlook, we will wait until this process is complete before sharing long-term financial commitments. We expect to offer operating details of our plans as well as long-term financial expectations at an investor event later this year.”

“The underlying objective of the new strategic direction we are sharing today is long-term shareholder value creation. While we have a high degree of conviction in our plans, we also acknowledge that markets and opportunities change over time. For this reason, our management team and our board of directors approach long-term plans in a practical and flexible manner. If we are convinced that some other set of opportunities, or some other course of action, improves our outlook or will better reward shareholders, we will adapt our plans accordingly.”