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Leading meat processor, Tyson Foods Inc. (TSN - Analyst Report), acquired the Warren, Mich.-based pizza maker, Bosco's Pizza Company, on Jan 18, 2014. The terms of the deal remain confidential.

Bosco's started as a carry-out pizzeria in 1988 and is known for its premium Original Bosco stuffed bread sticks. It also prepares a variety of stuffed breadsticks and frozen pizzas. It distributes its products to food service and retail customers in the U.S. and Midwest.

The acquisition fits well with Tyson’s strategy to grow its presence in the prepared foods sector. The sector has performed above the normalized range for several consecutive quarters. Chicken nuggets, chicken sandwiches, wings, meatball sandwiches and bone-in chicken have been witnessing growth for the past few years due to a change in consumers’ tastes.

Post acquisition, the pizza maker has become part of Tyson’s Prepared Foods division. Bosco’s Pizza will continue to operate under the current name and customer contacts will also remain the same. Vice President Operations, and Vice President Sales and Marketing of Bosco’s Pizza will continue in their present capacities. Founder Mark Artinian will function in an advisory role in the company. Bosco’s’ employees have become Tyson’s team members after the takeover.

Apart from the Bosco acquisition Springdale, AR-based Tyson has made several other acquisitions to bolster its presence in the prepared foods segment. In 2013, it acquired California-based Circle Foods LLC from Claridge Inc. and Don Julio Foods of Clearfield, Utah, to strengthen its foothold in Mexican cuisine.

Tyson Foods markets prepared food products to retail grocers, food service distributors, restaurant operators and on-site food service establishments such as schools, universities, corporate cafeterias, hotel chains, healthcare facilities and the military. Tyson has bright prospects by 2015 as management expects profit to rise further. Lower corn prices and higher chicken supply leading to a decline in chicken prices, is expected to boost profits in the next two years.

Tyson has a Zacks Rank #3 (Hold). However, better-ranked stocks in the retail sector include Hormel Foods Corp. (HRL - Analyst Report), Con Agra Foods Inc. (CAG - Analyst Report) and Green Mountain Coffee Roasters Inc. (GMCR - Analyst Report). All these stocks carry a Zacks Rank #2 (Buy).

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