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Sovos acquisition could result in local redundancies, Noosa sale

LOUISVILLE — The upcoming acquisition of Sovos Brands Inc. (Nasdaq: SOVO) by food giant Campbell Soup Co. (NYSE:CPB) may result in the elimination of some redundant administrative operations at Sovos’ Louisville headquarters and the offloading of the Bellvue-based Noosa Yoghurt brand. 

“While yogurt is not core to our strategy, we are excited that (Noosa) is performing very well with great products and strong profitability,” Campbell CEO Mark Clouse said in a conference call last week after the firm went public with its plan to absorb Sovos, which moved to Colorado from California several years ago and controls Rao’s pasta sauce, Noosa and Michael Angelo’s frozen entrées, in a cash deal valued at about $2.7 billion and expected to close later this year.

Strong performance from Noosa allows Campbell “to be patient while we evaluate strategic alternatives,” Clouse said. Once such alternative could be jettisoning the brand from Cambell’s meals and beverages division, where Sovos’ portfolio will be housed. 

Sovos acquired Noosa in 2018, a deal that at the time nearly doubled Sovos’ sales. In the years since, Noosa has continued to manufacture and source its yogurt ingredients in Bellvue.

Noosa was co-founded in 2009 by Koel Thomae, an Australian expat, and Rob Graves, a Colorado dairy farmer, who set out to bring the Aussie-style yogurt with a creamy texture and sweet-tart flavor profile to the U.S. market. The yogurt is made with whole milk, a touch of wildflower North American honey and real fruit purées on a family farm in Larimer County.

Cambell, according to its chief financial officer Carrie Anderson, expects the absorption of Sovos to result in the elimination of $50 million in annual redundant costs over the next two years, much of which could to be cleaved from Sovos’ administrative operations, which, of course, is headquartered in Boulder County. 

“Our plan is to continue to build on (Sovo’s) incredible momentum, maintain their high quality standards and retain members of their talented team,” Clouse said.

The specific local impact of the deal remains unknown.

Source: BizWest