J.M. Smucker selling businesses for $110 million

The J.M. Smucker Co. of Orrville said it has agreed to sell its natural and organic beverage and grains businesses to investment firm Nexus Capital Management LP for $110 million in cash.

The sale includes R.W. Knudsen and TruRoots assets and trademarks, a licensing agreement for Santa Cruz Organic beverages, and manufacturing and distribution facilities in Chico, California, and Havre de Grace, Maryland, Smucker said in a news release issued Wednesday evening, Dec. 15. Smucker noted that the deal does not include Santa Cruz Organic nut butters, fruit spreads, syrups or applesauce.

In what Smucker charactered as “a related decision” to “further optimize operations for the Consumer Foods business,” the company said it plans to close and pursue the sale of its Ripon, Wisconsin, production facility in 2022 and consolidate production at its Orrville plant.

The sale of the natural and organic beverage and grains businesses is expected to close in the third quarter of the company’s 2022 fiscal year, subject to customary closing conditions. Smucker said it expects the divestiture to be dilutive to its adjusted earnings per share by about 15 cents on a full-year basis, “reflecting the foregone profit related to the natural and organic beverages and grains businesses, before factoring in any potential benefit from the use of net proceeds from the sale.”