Nestlé said today it would buy Chef America for $2.6 billion in cash as it tries to cement its position in the fast-growing US frozen food market.
Nestlé, the world's largest food group, said the deal would include taking on Chef America's debts and involve a net transfer of about $2 billion after the effect of tax benefits.
Chef America, based in Colorado, is expected to generate sales of about $720 million this year, an increase of more than 15 per cent from 2001, Nestlé said.
The deal comes after Nestlé, which makes Perrier water, Nescafe instant coffee and Friskies cat food, recently proposed taking over Dreyer's Grand Ice Cream, a leader in the growing premium ice cream market.
Nestlé is also understood to be in the running to buy US confectionary maker Hershey, which is up for sale.