Shareholders of Del Monte Foods Co., the maker of pet foods Meow Mix and Milk Bone, approved a $5.3 billion takeover by private-equity firms after the vote was delayed to solicit more offers.
The purchase by buyout firms led by New York-based KKR & Co. will pay stockholders $19 a share, the San Francisco-based company said today in a statement. The transaction is expected to close this week, the statement said.
Delaware Chancery Judge J. Travis Lester last month delayed the vote and said Del Monte adviser Barclays Plc had a conflict of interest in handling the deal because it also helped finance the buyout group’s offer. The private-equity consortium includes Vestar Capital Partners and Centerview Partners.
Del Monte rose less than 1 cent to $19 at 2:25 p.m. today in New York Stock Exchange composite trading. Holders of about 149.8 million shares of Del Monte voted in favor of the deal, while 1.6 million shares voted against, according to the statement.
Private-equity firms are ramping up acquisitions as credit for deals becomes available from banks and investors snap up high-yield bonds used to finance the transactions. KKR co- founder Henry Kravis said last week that low interest rates are pushing financial institutions and pension funds to buy riskier assets because they are looking for better returns.
Buyout managers have announced $27.7 billion in deals so far this year, more than double last year’s total during the same period, Bloomberg data show. Private-equity firms pool investors’ money to take over companies, financing the purchase with mostly debt, with the intention of selling them later for a profit.
Kravis and George Roberts created KKR in 1976 and have expanded the firm to oversee about $61 billion in assets. In addition to private equity, the firm manages debt investments and offers underwriting services.
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