November 15, 2018 / 5:28 AM / a month ago

South Korean food giant CJ buy U.S. frozen food company for $1.84 billion

SEOUL (Reuters) - South Korea’s CJ CheilJedang Corp (097950.KS) said on Thursday it bought privately held U.S. frozen foods firm Schwan’s Co for $1.84 billion, the South Korean food-to-entertainment conglomerate’s biggest-ever acquisition.

The acquisition builds on CJ’s push into the United States. The firm in August bought Ohio-based Kahiki Foods, a supplier of frozen Asian meals to stores including Walmart Inc (WMT.N).

The latest deal will give CJ access to Schwan’s distribution network, including logistics centers and delivery vehicles, as it looks to expand its existing U.S. business focused on Korean food such as dumplings and noodles, CJ said in a statement.

Schwan’s, owner of brands such as Red Baron, Freschetta, MaMa Rosa’s and Tony’s pizza, has an annual revenue of $3 billion and the second-largest U.S. frozen-pizza market share, Jefferies said in a research note last month.

It employs 12,000 people.

CJ's shares rose 4 percent after the news. The broader market .KS11 was flat.

This buyout is among the biggest outbound deals in recent years by a South Korean company, following Samsung Electronics’ (005930.KS) $8 billion purchase of U.S. car tech company Harman and LG Electronics’ (066570.KS) $1 billion takeover of an Austrian auto light maker.

Reporting by Ju-min Park; Editing by Muralikumar Anantharaman and Sayantani Ghosh

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