B&G Foods' acquisition of Green Giant may be the first of many frozen food acquisitions in the future. 

PARSIPPANY, N.J. — B&G Foods may not be done acquiring frozen food assets. While the acquisition of the Green Giant and Le Sueur businesses from General Mills for approximately $765 million in cash represents a significant investment for the company and will take some time to integrate, management made it clear it sees other opportunities in the category.

Robert Cantwell, president and c.e.o. of B&G Foods.

“We believe by acquiring this strong frozen brand we will have opportunities in the future to add tuck-in acquisitions in the frozen food space as we now have a strong infrastructure in place to support (a) frozen business,” said Robert Cantwell, president and chief executive officer of B&G Foods, in a conference call with financial analysts on Sept. 3.

That frozen food infrastructure includes two plants, one in Irapuato, Mexico, and another plant in Belvidere, Ill. As part of the transaction B&G Foods will acquire the Irapuato plant from General Mills. The Belvidere plant manufactures other products for General Mills and was not a part of the deal. General Mills will continue to manufacture products at the plant for up to 24 months following the closing of the transaction.

Mr. Cantwell said B&G Foods has looked at acquiring other frozen food businesses in the past, but passed on the opportunities, because an infrastructure was not in place.

“… We just couldn’t build an infrastructure around a $100 million brand,” he said.

With an infrastructure in place, he said B&G Foods will be active in the marketplace.

“… We will absolutely be a player,” Mr. Cantwell said. “And again, our model is still very simple. The price has to make sense, be accretive to shareholders day one and it has to be accretive to our cash flow day one, too.”

Green Giant is unique in that it competes in the both the frozen and canned fields, Mr.Cantwell said.

As for revitalizing the Green Giant brand, Mr. Cantwell said B&G Foods plans to pay more attention to it than General Mills did. The company also plans to put more resources behind the business than General Mills, including doubling the current marketing spend to approximately $30 million to $35 million per year.

“This is a brand that was $100-million-plus (in sales) more than it is today,” Mr. Cantwell said. “Most of that decline has come in the frozen side of the business. We want to refresh this brand, potentially refresh packaging and be more innovative on products and really be more innovative in addition to the core, because there is a very powerful core of this brand.

“One of our big opportunities and part of the Green Giant opportunity is it plays both in canned and frozen, where a lot of the competitors that we go against that are in frozen don’t play in canned. So we have that consumer in two different parts of the store. But as we look at a lot of the new product innovation and where you see a lot of the product innovation in vegetables is in frozen and that is where we are going to spend most of our money.”