CINCINNATI ( TheStreet) -- Procter & Gamble ( PG) said early Tuesday it will divest its Pringles potato chips brand to Diamond Foods ( DMND) for $1.5 billion worth of stock.

The move comes as Procter & Gamble looks to more closely focus its business on cosmetics and healthcare products.

P&G shareholders will retain a 57% stake in the new company while Diamond shareholders will hold the rest.

Diamond shareholders will also take on $850 million of Pringles debt.

Diamond, best known for its Emerald brand of nuts and trail mixes, Pop Secret popcorns and Kettle potato chips, will more than triple the size of its snack business with the addition of Pringles. The company now expects net revenue to total $1.8 billion in the fiscal year ending July 31, 2012.

Diamond has been expanding through acquisitions in recent years.

In 2010, Diamond acquired Kettle Foods for $615 million. In 2008, Diamond acquired Pop Secret from General Mills ( GIS) for $190 million. And in 2006 it acquired certain assets from Harmony Foods.

Diamond said the Pringles deal will results in one-time costs of around $100 million over the next two years. P&G expects the divestiture to add around 50 cents per share to its earnings.

P&G shares edged 0.1% lower to $62.18 in early trading Tuesday while Diamond Foods soared 8.1% to $61.86 in the first minutes after the opening bell.

-- Written by Miriam Marcus Reimer in New York.

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