Hershey purchases two pretzel companies

The Hershey Co. recently entered into an agreement to acquire Dot’s Pretzels, the owner of Dot’s Homestyle Pretzels, and to purchase Pretzels Inc. from an affiliate of Peak Rock Capital.

Both transactions will cost the company approximately $1.2 billion.

Collectively, the businesses had aggregate net sales of approximately $275 million for the 12 months ending in September.

Dot’s Pretzels will complement Hershey’s growing salty snacking portfolio. Pretzels Inc. is co-manufacturer of pretzels for Dot’s Pretzels and several other customers. Its purchase gives Hershey product expertise as well as manufacturing capabilities to support continued growth in the pretzel category.

Three manufacturing locations in Indiana and Kansas operated by Pretzels Inc. and four pretzel-seasoning facilities to be acquired with Dot’s will become Hershey’s when the transactions are completed.

“As the fastest growing U.S. pretzel brand, Dot’s Pretzels would further accelerate our success in the permissible salty snack category, along with our successful SkinnyPop and Pirate’s Booty brands,” Michele Buck, Hershey President and CEO, said. “With a unique range of bold, distinctive seasonings and a flavorful crunch that creates a premium pretzel experience for consumers, Dot’s Pretzels stand apart from all other products in the pretzel category and represents 55 percent of the pretzel category’s growth during the past year.”

The deals are expected to close by the end of the year, subject to customary regulatory approvals.