October 15, 2018 / 7:19 AM / a month ago

Greencore sells U.S. business for $1 billion

DUBLIN, Oct 15 (Reuters) - Greencore Group, Britain’s biggest sandwich maker, on Monday said it had sold its U.S. business for just over $1 billion, two years after it made a major acquisition in a bid to transform its U.S. operations.

Greencore’s U.S. business produces sandwiches, salads, sushi and deserts for customers including Starbucks and the 7-Eleven convenience store.

In 2016 it purchased Illinois-based Peacock, which produces frozen breakfast sandwiches, snack kits for children and salad packs, among other items, for $747.5 million.

Greencore said in a statement it had agreed to sell its U.S. business to Hearthside Food Solutions for $1.075 billion.

It said it would distribute 509 million pounds ($668 million) in cash to shareholders and shift its full focus to developing its British business.

“We have always had a firm conviction on the underlying value and growth prospects of our U.S. business and believe that this offer fully reflects that,” Chief Executive Patrick Coveney said.

“The proposed transaction would enhance our strategic and financial flexibility, which would allow us to build on our industry-leading position in our core UK market whilst also taking advantage of emerging organic and inorganic growth opportunities,” he said.

Greencore said it hoped the deal would be completed by late November and said it would have an extraordinary general meeting to vote on it on Nov. 7.

$1 = 0.7622 pounds Reporting by Conor Humphries; editing by Jason Neely

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