Campbell Soup Co. has told Pacific Foods of Oregon that it could call off its $700 million acquisition if the latter company fails to resolve a $250 million shareholder lawsuit within 60 days.
The Camden-based food manufacturer had agreed in July to buy the organic soup company, pending customary approvals and conditions. However, in August, the estate of Edward C. Lynch, the late Pacific Foods co-founder, filed suit against the company, certain directors and others, seeking damages.
In a news release, Campbell said that, although it is not named in the suit, the action creates an impediment to closing. As a result, it has notified Pacific Foods that it has 60 days to resolve the issue, or Campbell has the option to either extend the time or terminate the sale agreement.
“We remain enthusiastic about acquiring Pacific Foods, which has a track record of growth and strong health and well-being credentials,” Mark Alexander, Campbell’s president, Americas Simple Meals and Beverages, said in a prepared statement. “However, we will not complete the transaction unless the issues arising from this litigation are resolved to our satisfaction.”
If the sale is finalized, Pacific Foods would become part of the Americas Simple Meals and Beverages division.
