NEW YORK (AP) -- Hillshire Brands is pushing further outside the deli case with a deal to buy the maker of Birds Eye frozen vegetables, Duncan Hines cakes mixes and Hungry-Man frozen dinners.

The Chicago-based company, which makes Hillshire Farm lunch meats, Jimmy Dean sausages and Ball Park franks, said Monday that it would buy Pinnacle Foods in a deal valued at $4.23 billion. The move builds up Hillshire's reach into other sections of the supermarket as more Americans watch how much meat they're eating.



In a phone interview, Connolly noted that Americans are eating meat just as often, but less of it per meal. He said that actually benefits Hillshire because food products that incorporate different ingredients -- such as its Jimmy Dean breakfast sandwiches -- are more profitable than simpler items lunchmeats or sausages.


Given its reduced reliance on meat, the combined company is expected to have significantly higher profit margins than Hillshire alone.



The ad is part of a major marketing push by the American Frozen Food Institute, which represents companies including Hillshire, Pinnacle, ConAgra, Nestle and others.

When asked whether Hillshire planned to hold onto all of Pinnacle's products, Connolly said it was "too early to tell," but noted Hillshire's record of investing heavily in its strongest brands. He added that Birds Eye, which has a more health-conscious image, was particularly attractive to Hillshire when eyeing the deal.

Last month, Hillshire also said it was buying Van's Natural Foods, which makes gluten-free foods including cereal, chips and snack bars.


Each share of Parsippany, New Jersey-based Pinnacle Foods common stock will be exchanged for $18 in cash and 0.5 shares of Hillshire Brands common stock. The companies said the implied purchase price is $36.02 per share, an 18 percent premium to Pinnacle's Friday closing price.




