Pinnacle warns of ‘intensified competition’ in grocery as Conagra deal nears | Food Dive

Still, Brittany Weissman, an analyst at Edward Jones, told Food Dive last week that the deal was good for Conagra. The company in recent years has jettisoned its private label business and frozen potato company Lamb Weston to focus on its core brands, using M&A to bulk up in areas such as snacking and frozen where it already had a commanding presence.

“This is something that has probably been well vetted, and they’ve kind of seen the complements in that business for a long time,” Weissman said. “I do think there are a lot of synergies.”

With the deal expected to close later this month, Conagra said Tuesday it would issue $575 million in common stock to fund the acquisition — which, based on Monday’s closing price, would equal about 16.6 million shares. While share dilution is generally frowned on Wall Street, the fact that Conagra’s stock rose following the news shows many believe this is a deal the company needs to make as consumer tastes change and legacy food companies struggle to keep pace.

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Pinnacle warns of ‘intensified competition’ in grocery as Conagra deal nears | Food Dive.