Del Monte Pacific buys US canned food business for $1.7bn SINGAPORE, October 11 - Singapore-listed Del Monte Pacific will buy the canned food business of private equity-backed Del Monte Foods Consumer Products for $1.7bn, gaining a direct presence in the key US market and reuniting a substantial portion of the Del Monte brand family. Shares in Del Monte Pacific surged 10 per cent on the deal. It said the acquisition would give it the number one branded position in major canned fruit and vegetable categories in the US as well as the opportunity to offer some of its own products to the large and fast-growing Asian and Hispanic populations there. The deal will also allow San Francisco-based Del Monte Foods to concentrate on its pet foods unit, including the recent acquisition of Natural Balance. Del Monte Foods was acquired in 2011 by KKR, Vestar Capital Partners and Centerview Capital in a deal valued at $5.3bn. With the sale of its canned food business, the company plans to change its name. Del Monte Pacific, a company that is strong in canned pineapple and tomato sauce, has been enjoying strong growth with net profit nearly trebling over the past three years to $32.1m in 2012. The transaction will give it additional net sales of more than $1.8bn. "This landmark transaction offers DMPL greater access to a well-established, attractive and profitable branded consumer food business in the world's biggest market," Rolando Gapud, Del Monte Pacific's chairman, said. Del Monte Pacific, which counts the Philippines as its largest market, is 67 per cent-owned by NutriAsia Pacific Ltd (NPL). NPL is owned by the NutriAsia group, which is majority-owned by the Campos family of the Philippines. With Thursday's share surge, the company's stock is up 76 per cent so far this year, valuing the group at S$1.17bn ($936m). Del Monte Pacific said the deal would be largely funded through a combination of about $745m of equity in the company's new acquisition subsidiary, as well as long-term debt financing of about $930m that has been committed by a syndicate of bank lenders. It also plans to issue common and preferred shares in the market. Perella Weinberg Partners LLC is the lead financial adviser and Citibank is a financial adviser to the company on this transaction. Pinnacle Foods Inc and Fresh Del Monte Produce Inc were among the companies that had considered offers for Del Monte Foods" canned foods business, sources have said. Del Monte Pacific and its subsidiaries are not affiliated with other Del Monte companies in the world, including Fresh Del Monte Produce Inc, Del Monte Canada and Del Monte Asia Pte Ltd.