Denver and El Segundo, CA--The Simply Good Foods Company has entered into a definitive agreement to acquire Quest Nutrition, LLC, for $1.0 billion in cash, or approximately $870 million net of tax benefits, on a cash-free and debt-free basis, according to an announcement by the companies.

The pairing of Atkins and Quest, according to a press release, results in a nutritional snacking company with combined estimated net sales of over $800 million and strong operating margins, plus positions Simply Good Foods to  benefit from consumer mega trends related to healthy eating and better nutrition.

“We are excited to join the Simply Good Foods family and I’m personally pleased to be joining the Simply Good Foods Board of Directors upon closing, as we collectively drive the next stage of Quest’s growth,” said Dave Ritterbush, president and CEO of Quest Nutrition. “The Simply Good Foods team has a strong track record in building leading nutrition brands and I feel that Quest will fit perfectly in their overall mission. As part of Simply Good Foods, Quest will benefit from the combination of two great organizations focused on providing consumers with healthier food choices. I’m incredibly proud of everything that Quest and our team has accomplished and excited for the next phase of our growth by joining a larger, more diverse nutritional snacking company.”

Highlights of the deal, according to the press release:
  • Complementary Portfolio. Quest’s bars, cookies, chips and pizza compete in many fast growing sub-segments within the nutritional snacking category. What's more, according to the announcement, Quest has strong appeal among consumers 18-44 years old with almost no overlap with the Atkins consumer.
  • Scalable, Growth-Oriented Platform. The announcement explains: "Given Quest’s growth trajectory, innovation pipeline and identified cost synergies, we believe there is financial flexibility to continue investing in the Quest business and expand margins that should, over time, be relatively similar to Simply Good Foods."
  • Shared Mission. The deal enables Simply Good Foods to benefit from Quest’s  e-commerce, social platforms, specialty and other non-tracked distribution channels, while Quest will benefit from Simply Good Foods’ expertise in building distribution in FDM (food/drug/mass) channels, according to the release.
  • Synergies. The deal is expected to create an estimated $20 million in cost synergies over three years by leveraging efficiencies of scale.
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The transaction, according to a press release, is structured as the purchase by a subsidiary of Simply Good Foods of 100% of the equity of each of Voyage Holdings, LLC and VMG Quest Blocker, Inc., from the founders of Quest and other equity holders. Details of the finacial overview, terms and financing can be foundhere.