Hershey Foods to Sell Pasta Business

Hershey Foods Corporation and New World Pasta, LLC, have signed an agreement providing for the acquisition of Hershey's U.S. pasta business by New World. As a result of the transaction, Hershey will receive $450 million in cash and will retain a minority interest in the business.

The transaction will include the American Beauty, Ideal by San Giorgio, Light 'n Fluffy, P&R, Mrs. Weiss, Ronzoni, San Giorgio and Skinner pasta brands, along with six manufacturing plants.

New World plans to locate the headquarters for the pasta business in the Central Pennsylvania area. As part of the transaction, Hershey and New World have agreed that all of the current pasta employees will be offered employment by New World. The transaction is subject to any necessary regulatory approvals and is expected to close by the end of January 1999.