FX.co ★ TreeHouse Foods To Buy Private Brand Tea Maker Harris Tea In $205 Mln Deal; Backs Outlook

TreeHouse Foods, Inc., a leading producer of private label snacks and beverages, announced its definitive agreement to acquire certain divisions of Harris Freeman & Co, Inc.'s private brand tea operations for approximately $205 million. This amount is subject to standard purchase price adjustments.

In reaffirming its financial outlook for the entire year of 2024, TreeHouse Foods expects to see a sequential increase in both volume growth and profit margin during the fourth quarter.

Harris Tea, a prominent manufacturer of private label tea in the United States, operates two production facilities located in Moorestown, New Jersey, and Marietta, Georgia. The acquisition involves these facilities as well as approximately 300 Harris Tea employees.

The transaction is scheduled to be completed in the first quarter of 2025, primarily financed with available cash reserves.

According to TreeHouse Foods, the acquisition will vertically integrate its existing tea operations and enhance the company's overall growth and profitability.

Steve Oakland, Chairman, CEO, and President of TreeHouse Foods, expressed, "Acquiring Harris Tea strengthens our competitive stance in the rapidly growing tea segment, adding unique blending and sourcing capabilities that our customers seek. This bolsters TreeHouse Foods' leadership in the category, providing greater depth and scale. This acquisition is in line with our strategy to expand in higher-growth, higher-margin areas."

Wells Fargo Securities, LLC acted as the exclusive financial advisor while Holland & Knight provided legal representation to Harris Tea in this transaction.

In early NYSE trading, shares of TreeHouse Foods declined by roughly 1.1%, reaching a price of $33.95.