On Thursday, Hormel Foods (NYSE: HRL ) announced it has signed a definitive agreement to buy Unilever's (NYSE: UL ) (NYSE: UN ) Skippy peanut butter business, the No. 2 U.S. branded peanut butter and the No. 1 peanut butter brand in China.
In a statement, Hormel said it expects Skippy to record $370 million in annual sales, of which more than 25% come from outside the U.S. Hormel is paying $700 million for Skippy, or just under two times sales.
The company expects the acquisition to be "modestly accretive" in fiscal 2013, and to add $0.13 to $0.17 per share in fiscal 2014.
The Skippy peanut butter domestic line consists of 11 varieties of shelf-stable peanut butter products. According to Hormel, peanut butter is a $2 billion category and the second-most-popular sandwich behind ham in the United States.