Hormel buys natural food company Applegate Farms

The maker of Spam is getting into the natural foods business in a big way.

Hormel announced a $775 million deal to buy Applegate Farms, a leading provider of natural and organic prepared meats.

In a statement Tuesday, Hormel officials praised Applegate's strong brand and said they do not plan to change the way the smaller firm's meats are raised and produced.

Hormel said it expects to boost Applegate's annual sales, which have been around $340 million a year. Hormel recently reported double-digit earnings growth, despite the avian flu outbreak's effects on the company's turkey business.

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