Sara Lee has sold the majority of its North American foodservice coffee and tea operations to The JM Smucker Company, which owns coffee brand Folgers, for $350m (£218m).
Jan Bennink, executive chairman of Sara Lee, said: “In recent years, our North American coffee business has been foodservice-based and largely unbranded, which is a challenge in a highly competitive marketplace.
“Our decision to sell a major part of this business to Smucker is an example of Sara Lee Coffee and Tea’s renewed focus on sustainable, profitable growth.”
Smucker and Sara Lee have also entered into a licensing agreement to co-operatively develop liquid coffee technologies to drive long-term growth.
“This transaction further strengthens our position as a leading North American coffee company,” said Richard Smucker, chief executive officer of The JM Smucker Company.
“The addition of liquid coffee concentrate to the Smucker portfolio aligns with our desire to compete in all forms of coffee, adding to our roast and ground, single-serve, instant and ready-to-drink platforms. The innovation partnership further allows us to collaborate on new technologies in the liquid coffee category for the foodservice market.”