Post Holdings, Inc. (NYSE:POST) is working with investment bankers to explore a possible transaction with Lamb Weston Holdings, Inc. (NYSE:LW), a frozen potato products maker facing pressure from an activist investor to sell itself, two sources familiar with the matter said. For packaged goods company Post, which makes Grape Nuts cereal and Bob Evans mashed potatoes, Lamb Weston has long been an attractive business that it considered buying in 2015 when the french-fry maker was still part of Conagra. Now Post is again exploring ways to own Lamb Weston and is consulting with bankers in the tight-knit food industry, said the sources who insisted on anonymity because the discussions are private.
Post has a market value of roughly $7 billion and the sources said there would be considerable synergies with Lamb Weston, which has a market value of roughly $10.5 billion, if a combination were to occur. Representatives for Post and Lamb Weston declined to comment.
Lamb Weston Holdings, Inc. is a global producer, distributor, and marketer of value-added frozen potato products. The Company is a supplier of frozen potato, sweet potato, appetizer and vegetable products to restaurants and retailers around the globe. The Companyâs segments include North America and International. The Companyâs frozen potato products are sold in North America and international markets generally to North American-based restaurant chains and international customers, comprised of global and regional quick service and full-service restaurant chains, foodservice distributors, and retailers. Its product portfolio includes frozen potatoes and appetizers sold under the Lamb Weston brand, as well as many customer labels. The Companyâs product categories include classic fries, extra crispy fries, sweet potatoes, and other products. Its recipes include appetizers, desserts, dips, sauces and seasonings, entree, salad, side dishes, and topped and loaded.
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