NORTHFIELD, Ill. – Kraft Foods Inc. (KFT) announced Wednesday it has agreed to sell its yogurt business, including licenses for Breyers' Creme Savers (search), Fruit on the Bottom (search) and Light 'n Lively, to CoolBrands International Inc. for about $59 million.
Northfield-based Kraft expected the yogurt business to generate about $90 million in net revenue in 2004.
"One of the core strategies of our Sustainable Growth Plan — transforming our portfolio — calls for accelerating Kraft's shift toward businesses in which we have sustainable competitive advantage," said Dave Johnson, president of Kraft North America Commercial. "Selling these brands permits us to better focus our time and resources on opportunities providing Kraft greater potential for long-term growth."
The transaction, subject to regulatory approval, is expected to be completed in the first quarter of 2005 and result in an after-tax book loss of about $12 million, or 1 cent per share, Kraft said. The deal includes a manufacturing plant in North Lawrence, N.Y.
CoolBrands (search) President and Co-Chief Executive Officer David J. Stein said the acquisition would help Ontario-based CoolBrands diversify its products in what he described as a high-growth snack area. CoolBrands products include Eskimo Pie (search), Tropicana Smoothies and Swensen's Ice Cream.
Kraft's other brands include Kraft cheese, Maxwell House coffees, Nabisco crackers and Post cereals.
Kraft shares fell 28 cents to $35.02 on the New York Stock Exchange.