Hershey is getting skinny.
Candy giant Hershey Co. said Monday that it had reached a deal to acquire the maker of Skinny Pop popcorn, Tyrrells chips and other snack brands.
Hershey will pay more than $920 million for Amplify Snack Brands in a move that will allow the candy manufacturer to nibble into new markets.
“The acquisition of Amplify and its product portfolio is an important step in our journey to becoming an innovative snacking powerhouse as together it will enable us to bring scale and category management capabilities to a key sub-segment of the warehouse snack aisle,” Hershey CEO Michele Buck said in a statement.
Many consumers are trending toward more natural foods and ingredients, prompting packaged food companies like Hershey to pivot.
The deal gives Hershey a stronger foothold in the market for what it called "better-for-you products that deliver clean, simple and transparent ingredients as well as unique flavors and forms."
In addition to the $920 million cash element of the deal, the company will assume net debt and make another tax payment for a total deal value of about $1.6 billion.
Amplify's largest shareholder, affiliates of TA Associates, and other significant Amplify stockholders have already agreed to back the deal, representing about 57% of outstanding shares.
Hershey said the deal, which equals $12 per share for Amplify's stock, would close in the first quarter.
The announcement sent Amplify shares up 72.9% in pre-market trading to $12.08.