H.J. Heinz (HNZ) said its HP Foods unit agreed to sell its Ethnic Foods business to Associated British Foods.
Terms weren't disclosed, but Pittsburgh-based Heinz said the pact comprised a small part of the HP business acquired in August by Heinz.
The HP Foods Ethnic Food business supplies a wide range of owned and agency brands to the Chinese, Indian and Thai restaurant sector, as well as specialist retailers. These include Rajah, Green Dragon, Lotus, Maharajah, Cathay and Dynasty.
"Selling the HP Ethnic Foods business, which is sold primarily through the ethnic distribution channel, is in line with our strategy of focusing on three core categories where Heinz is a sector leader: ketchup, condiments & sauces; meals & snacks; and infant nutrition," said Joe Jimenez, CEO of Heinz Europe. Heinz acquired HP Foods to focus on three sauce brands: Lea & Perrins, HP sauces and a perpetual license to market the rapidly growing Amoy Asian sauces brands in Europe.
The proposed sale to ABF will include the transfer of 30 employees based in Europe including the UK. The UK Competition Commission, currently investigating Heinz's acquisition of HP, has approved the proposed sale. The sale should be completed in the next two months.
Heinz shares dropped 4 cents Tuesday to $33.96.