Why Sovos Brands Stock Is Soaring Today
Campbell Soup (NYSE: CPB) is dipping into the pantry for growth, agreeing to a deal for $2.7 billion in cash and assumed debt to acquire Sovos Brands (NASDAQ: SOVO). The deal offers a substantial premium to Sovos shareholders, and the stock is up 25% on Monday morning as a result.
Sovos is a relatively young company, formed in 2017 and public since 2021. The company is the maker of pasta sauces, dry pasta, soups, frozen entrées, frozen pizza, and yogurts, all sold in North America under the brand names Rao's, Michael Angelo's, and noosa.
On Monday, Campbell agreed to acquire Sovos for $23 per share in cash, a premium of 28% to Sovos' Friday close. Campbell is paying a healthy 14.6 times adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) for Soros, looking to diversify and grow its meals and beverages division.
Source Fool.com
