July 23, 2010 (FinancialWire) (Go to http://www.financialwire.net/?s=ftrdnwswnd for all of today’s featured news.) — Snack food makers Lance, Inc. (NASDAQ: LNCE) and Snyder's of Hanover, Inc. said they have signed a definitive agreement to combine in a stock-for-stock merger that will create a combined company to be called Snyder's-Lance, Inc. The transaction brings together Snyder's, a firm known best for pretzels that traces its roots to 1909, with Lance, a U.S. snack food firm founded in 1913 that is specialized in sandwich crackers, potato chips, and cookies. Under the transaction terms, shareholders in Snyder's and Lance will each own around 50% of the new company after the merger.

Existing Lance and Snyder's options will become options in the combined Snyder's-Lance.

Additionally, contingent on the closing of the transaction, existing Lance shareholders will receive a one-time $3.75 special cash dividend. The principal shareholders of Snyder's have agreed to vote in favor of the merger. The boards of both companies have unanimously recommended the approval of the transactions to their shareholders.

Brands held by the combined firm will include Lance, Snyder's of Hanover, Cape Cod and Grande. Snyder's-Lance will have a national distribution footprint including a leading direct store delivery network in the United States.

Snyder's-Lance will have pro forma combined net sales of around $1.6 billion, adjusted EBITDA of approximately $170 million, pre-synergies, and what Lance calls, “strong free cash flow for the twelve month period ended June 26, 2010.”

The companies said they expect the combination to generate more than $30 million in annualized synergies. The transaction is not expected Lance to materially impact its stand-alone earnings in 2010, excluding special items, but will add incremental earnings per share of more than 10%, on a fully synergized basis.

Michael A. Warehime, current Snyder's chairman, will serve as chairman of the board of the combined company, and W. J. Prezzano, current Lance chairman, will serve as lead independent director.

David V. Singer, current Lance president and CEO, will become CEO of Snyder's-Lance. Carl E. Lee, Jr., current Snyder's president and CEO, will become president and chief operating officer of the combined firm. Rick D. Puckett, current Lance EVP and chief financial officer, will become EVP and CFO of the combined company.

Snyder's-Lance will have a 16 member board drawn primarily from the existing boards of both companies. It will be comprised of eight directors of the current Lance board and seven directors of the current Snyder's board. An additional independent director will be elected by the new board immediately after closing, according to the companies.

The company will have corporate headquarters in Charlotte, North Carolina and additional headquarters in Hanover, Pennsylvania, where certain key management figures and functions will continue to be located.

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