TreeHouse to buy hot-cereal maker Sturm

TreeHouse Foods Inc. jumped the most in more than four years in New York trading after agreeing to buy Sturm Foods, a maker of hot-cereal and powdered soft-drink mixes for retailers, for $660 million.

TreeHouse, which produces pickles, soup and nondairy creamer, rose $5.92, or 18 percent, to $39.48 at 12:09 p.m. in New York Stock Exchange composite trading. That's the steepest increase since June 2005. The shares had gained 23 percent this year before today.

The purchase from shareholders including HM Capital Partners LLC is scheduled to close by March 31, TreeHouse said in a statement today. The acquisition will increase annual revenue by more than $340 million, the Westchester-based company said.

The acquisition of Manawa, Wisconsin-based Sturm will make TreeHouse the leader in the private-label hot cereal and powdered soft-drink mix categories, with market share of 26 percent and 20 percent, respectively, Sam Reed, chairman and chief executive officer, said in a statement.