Hot Deal for Hot Pockets

In a blockbuster deal that would give Nestle the dominant position in frozen handheld entrees, Nestle U.S. Holdings-the U.S. arm of the Swiss food titan-has agreed to pay $2.6 billion for Chef America. If approved by regulators, the acquisition would add the likes of hot Pockets, Lean Pockets, and

The trio of Pockets productsNos. 1, 2, and 3, respectively, in the frozen hand-held entrees (nonbreakfast) segment of the frozen dinners and entrees categoryhad combined supermarket sales of more than $500 million for the year ended June 16, 2002, according to Information Resources, Inc. (Chicago) According to Nestle, Chef America is expected to generate total sales of some $720 million this year.

The move is the second major acquisition by Nestle in recent weeks-and may not be the last. The company is currently seeking regulatory approval for a deal giving it a controlling interest in Dreyer's, and is reportedly also a player in the estimated $10 billion-plus sweepstakes for U.S. candy icon Hershey.