Quaker Buys Chico-San from Heinz to Puff Up Rice Cake Business
May. 18, 1993
CHICAGO (AP) _ Quaker Oats Co. is puffing up its already commanding share of the rice cake business by acquiring rival Chico-San from the H.J. Heinz Co., the companies announced Tuesday.
The purchase price was not disclosed.
Quaker has a 63 percent share of the U.S. rice and popcorn cake market, which grew by 18 percent last year to $174 million, according to the market research firm Information Resources Inc.
Chico-San, acquired by Pittsburgh-based Heinz in 1984, is the second- largest-selling brand with an 18 percent market share, followed by Pet Inc.'s Hain brand with 11 percent.
The deal includes Chico-San's brand names, inventory and Gridley, Calif., plant, which employs about 100 people, Quaker spokesman Ronald Bottrell said.
Chico-San was founded in 1962 in Chico, Calif. Quaker entered the low- calorie rice cake business in 1985 and has expanded its product line with a variety of flavors.
The acquisition will enable Quaker to expand production and variety of both the Quaker and Chico-San brands, Quaker Chairman William D. Smithburg said in a statement.
Heinz U.S.A. President William C. Springer said rice cakes did not fit into his company's strategic plan. Heinz will use proceeds from the sale to invest in its core food businesses, he said.