TreeHouse Foods Expands Private Label Reach

US private label food group TreeHouse Foods has signed a deal to purchase Sturm Foods from US private equity business HM Capital Partners. The acquisition, which will cost US$660mn and is expected to go through in March 2010, will expand TreeHouse's activities into the areas of hot cereal and powdered soft drinks. The firm said both categories are large and growing, offering 26% and 20% of private label share respectively. The deal comes at a time when demand for private label goods is growing in response to the economic downturn. However, the challenge for TreeHouse and other private label producers will be to sustain this momentum once the economic environment improves.

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