Hormel Foods is buying a California firm that makes sports nutrition powders, shakes and bars.
Hormel will pay about $450 million for CytoSport , a firm best known for its high protein Muscle Milk products aimed at athletes, the Austin, Minnesota-based company said Tuesday.
The deal should boost Hormel's earnings, expand its distribution channels and provide products that appeal to younger people, said Brian Yarbrough, an analyst with the investment firm Edward Jones.
Muscle Milk is "a very strong brand," he said. "Internationally, this brand is just scratching the surface."
Hormel said it expects Muscle Milk products will spark growth in the company's specialty foods segment. CytoSport is expected to have sales of about $370 million this year. The deal is expected to close within 30 days.