US-based packaged foods manufacturer TreeHouse Foods has entered a definitive agreement to sell its snacks division to Atlas Holdings.

Atlas has agreed to pay $90m, subject to certain post-closing adjustments.

TreeHouse Foods president and CEO Steve Oakland said: “The sale of the snacks division is a key step in optimising TreeHouse’s overall product portfolio.  It is the culmination of TreeHouse’s strategic review of its snacks business.

“This transaction allows the snacks division to unlock its potential and serve its customers even better under Atlas’ ownership. We are grateful for the hard work put forth by the snacks team during these last several years.”

TreeHouse intends to use net proceeds from the divestment to reduce its debt.

With more than 800 employees, TreeHouse Foods’ snacks division is a leading manufacturer and distributor of private label healthy snacks in North America. Its snacks division is projected to generate net sales of nearly $670m this year.

The snacks division operates three manufacturing facilities, which are located in Robersonville in North Carolina, El Paso in Texas, and Dothan in Alabama.

TreeHouse also plans to close its facility in Minneapolis, Minnesota.

Completion of the deal is subject to customary closing conditions. It is expected to close in the third quarter of this year.

Atlas Holdings partner Michael Sher said: “This snacks business will be a welcome addition to the Atlas family of manufacturing and distribution companies.

“Customers are consistently choosing private label brands, and this business is a premier manufacturer with unique growth potential.  We’re excited to partner with this team to deliver the finest healthy, private label snacks in the industry.”

Headquartered in Greenwich, Connecticut, Atlas and its affiliates own and operate 19 manufacturing and distribution businesses, which collectively employ more than 17,000 associates at more than 150 facilities worldwide.

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