Heinz Mulls Buy of Pfizer Baby Formula Business: Report (Update 1)
Corrected quote from analyst Erin Lash in third paragraph
NEW YORK (TheStreet) -- Heinz (HNZ) may make a run for all or part of pharmaceutical company Pfizer's (PFE) baby formula business, according to The New York Post.
The Post said Pfizer accepted first-round bids for the division over the holidays. The newspaper referred to the potential purchase as a "$9 billion transformative deal."
Morningstar analyst Erin Lash also said it would be a "transformative" deal for Heinz if the company acquires all of Pfizer's infant nutrition business, provided a deal happens at all.
"Heinz has placed an emphasis on growing its presence in emerging and developing markets, but up to now has primarily utilized organic growth or has pursued smaller bolt-on deals to broaden its distribution network," Lash said.Some of Pfizer's baby nutritional brands include Progress, Progress Gold and Promise Gold. A Pfizer spokeswoman said the company's exploration of strategic initiatives for this division is ongoing. "We're currently pursuing the activities associated with evaluating all options, including sale, spin-off or other transaction. However, no decisions have been made at this point," the spokeswoman wrote. "We expect to be in a position to announce any decision in 2012, and continue to expect to complete any transactions that may result from this decision between July 2012 and July 2013." A Heinz spokesman declined to comment. Shares of Heinz fell 17 cents to $53.07 in Tuesday's trading, while Pfizer's stock rose 10 cents to $21.92. --Written by Alexandra Zendrian in New York.
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