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Snacks maker Snyder's-Lance to buy Diamond Foods for $1.91 bln

Products of Diamond Foods as shown on their website
Source: Diamond Foods
Products of Diamond Foods as shown on their website

Snack food maker Snyder's-Lance said it will buy Kettle potato chips maker Diamond Foods for about $1.27 billion.

Diamond Foods said its stockholders will get 0.775 Snyder's-Lance shares and $12.50 in cash for each share they hold.

The $40.46 per-share cash-and-stock offer represents a 16 percent premium to Diamond's Tuesday closing.

The deal is valued at $1.91 billion including $640 million of Diamond Foods' debt.

Kellogg was said to be in late-stage talks to buy Diamond Foods for more than $1.5 billion, the New York Post reported last week.

Oaktree Capital, Diamond's largest stockholder, has agreed to vote in favor of the transaction, Snyder's-Lance said.

Snyder's-Lance said the deal, which is expected to immediately add to its earnings, would expand its presence in the natural foods category.

Morgan Stanley is financial adviser to Snyder's-Lance and Troutman Sanders is the company's legal adviser.

Credit Suisse is financial adviser to Diamond and Fenwick & West is the company's legal adviser.