By Published on .

CINCINNATI (AdAge.com) -- Procter & Gamble Co. announced today it has agreed to sell its Jif and Crisco brands to J.M. Smucker Co. in a tax-free stock deal valued at around $1 billion.

In a speech to shareholders Tuesday, P&G President-CEO A.G. Lafley said the cooking oils and shortening business had become a commodity category where private label is making inroads. He has also said Jif was no longer strategic for P&G because it has no potential for becoming global.

Both brands had received light ad support of less than $10 million annually in recent years. Jif was handled by Grey Global Group's Grey Worldwide, New York. Crisco does not have an agency.

The move leaves P&G with a pared down food business that includes Folgers and Millstone coffee, Pringles snacks and Sunny Delight beverages. P&G had placed the Jif and Crisco brands on the market this spring after moving to spin off most of the rest of its food and beverage business into a joint venture with Coca-Cola Co. But Coca-Cola last month backed out of the deal that already had been scaled back to a distribution and product development alliance.

Mr. Lafley told shareholders the company plans to continue its food and beverage business, focusing on what he called the fast-growing categories of coffee and coffee-based beverages, snacks and juice drinks. He also said P&G hopes to apply lessons learned about expanded distribution through the proposed Coke deal in an effort to expand Pringles, which he said is the No. 2 snack brand in the world.

Analysts and executives close to the company, however, believe P&G may revisit selling at least some of its remaining food and beverage brands after first trying to reinvigorate a business whose sales fell 11% last year to $4.1 billion.

Correction: An earlier version of this story incorrectly reported that Publicis Groupe's Saatchi & Saatchi is the agency of record for Crisco. The brand does not currently have an agency of record.

Most Popular
In this article: