Michael Foods pursuing deals to bolster growth

  • Goldman Sachs PE unit is company’s backer
  • Tyson Foods is considered most likely buyer
  • Strategics, sponsors also are in talks

The disclosure from Michael Foods came days after Reuters reported that the egg and dairy products producer owned by Goldman Sachs Group Inc’s private equity unit, is in the advanced stage of finding a buyer.

People familiar with the process have previously identified Tyson Foods Inc as the most likely buyer, according to Reuters.

Other parties in talks with the company include food manufacturer TreeHouse Foods Inc and private equity firms Golden Gate Capital and Oaktree Capital Management, Reuters has reported.

“Management’s comments bolster our belief that Michael is on the block, as has been reported in the media, and we would not be surprised if Tyson, Hillshire, or TreeHouse were potential suitors,” JPMorgan analyst Ken Goldman wrote in a client note.

Minnetonka, Minnesota-based Michael Foods produces and distributes products including specialty eggs, refrigerated potatoes, cheese and other dairy products. In its filing, Michael Foods said it “can provide no assurances that it will actually enter into such a transaction or effect any strategic alternatives.”

Lisa Baertlein is a correspondent for Reuters in Los Angeles.