Post Holdings Inc., the owner of the Grape- Nuts and Honeycomb breakfast cereals, agreed to buy Mom Brands Co. for $1.15 billion to add bagged and hot cereals to its product lineup.

Post will pay $1.05 billion in cash and about 2.45 million shares to the owners of closely held Mom Brands, St. Louis-based Post said in a statement today. Post has arranged to borrow as much as $700 million to help pay for the purchase, and also plans to sell about $240 million in stock, the company said.

Buying Mom Brands will solidify Post’s position as the third-biggest maker of ready-to-eat cereals, Post said. Mom Brands, which was known as Malt-O-Meal until 2012, was founded in 1919 by John Campbell using $900 of poker winnings, according to the company’s website. The Lakeville, Minnesota-based company describes itself as the world’s largest family-owned cereal maker.

“After a century of spirited rivalry between MOM Brands and Post, we now look forward to combining our strengths,” Rob Vitale, Post’s president and CEO, said in the statement.

Bankers at Barclays Plc and Credit Suisse Group AG advised Post, and Lewis, Rice & Fingersh, LC is acting as legal adviser. BofA Merrill Lynch provided financial advice to MOM Brands, with Faegre Baker Daniels LLP as acting as legal adviser.

Post fell 2 percent Jan. 23 to close at $41.44, giving the company a market value of $1.9 billion. 

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