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Boulder Brands and its line of Udi's gluten-free breads, Evol natural frozen foods and Earth Balance oil-based spreads has landed in the hands of the multibillion-dollar maker of Birds Eye frozen vegetables, Duncan Hines cake mixes and Vlasic pickles. Pinnacle Foods is snapping up the Boulder-based Boulder Brands for $975 million, which includes $265 million in debt, the companies announced Tuesday. Parsippany, N.J.-based Pinnacle plans to submit a tender offer to acquire Boulder Brands' outstanding shares for $11 each, or about $710 million. The transaction could close in the first quarter of next year. It's a health-and-wellness buy for Pinnacle (NYSE: PF), which owns a variety of brands across the frozen, refrigerated and packaged foods aisles in the grocery store. In addition to Birds Eye, Pinnacle's portfolio includes such brands as C&W, Mrs. Paul's, Hungry-Man, Log Cabin and Lender's. The Pinnacle deal follows a period of turbulence for Boulder Brands that included the resignation of its CEO, layoffs and tepid earnings. In August, Boulder Brands enlisted William Blair & Co. to review its strategic options, including a sale and a thinning of product lines. Boulder Brands (Nasdaq: BDBD), formerly Smart Balance, owns a cluster of brands that includes Evol frozen meals, Smart Balance and Earth Balance oil-based spreads, and Udi's and Glutino gluten-free products. In 2014, Boulder Brands lost $127.1 million and posted $516.6 million in revenue. Pinnacle said it plans to retain Boulder Brands' headquarters in Boulder, which Pinnacle CEO Bob Gamgort called a "hotbed of on-trend food startups." "(The Boulder office) we expect to prove will be an important better-for-you business hub," Gamgort said Tuesday morning in a conference call with analysts. The deal bolsters Pinnacle's presence in natural grocery stores, gives it additional holdings in the growing natural and organic foods industry, and provides it a means of tapping into a younger customer base, Gamgort said. Pinnacle officials said they expect cost-savings to occur in areas that include administrative and product costs but did not immediately specify those actions. In the call with analysts, Gamgort noted that Pinnacle will review Boulder Brands' operations, including its manufacturing facilities. "I think that we have a really nice situation here where we're going to be able to get the overhead costs more in line with the growth targets of this business but not changing the culture or the DNA or the soul of this business at all," Gamgort said. On the spreads business, Gamgort said he sees an opportunity to "reinvigorate" the struggling Smart Balance brand and grow that segment by reducing the number of SKUs in that category. Gamgort lauded the upside of plugging brands such as Evol and Udi's into Pinnacle's expansive distribution and retail network. By acquiring Udi's and Glutino, Pinnacle gains the leaders in a growing gluten-free category, he said. "This is not a fad," he said. "This is a sustainable trend that's driven by a real consumer need." Alicia Wallace: 303-954-1939, awallace@denverpost.com or @aliciawallace
