Ralcorp Investor Corvex Said to Seek ConAgra Deal Revival

Ralcorp Holdings Inc. (RAH) investor Corvex Management LP is interested in reviving ConAgra Foods Inc. (CAG)’s bid for the maker of Raisin Bran cereals, according to a person familiar with the matter.

Corvex wants Ralcorp to explore selling the company or merging with another, and ConAgra is a possibility because the company made a bid last year, said the person, who asked not to be named because the discussions are private. Corvex disclosed in a regulatory filing today that it acquired a 5.1 percent stake in St. Louis-based Ralcorp and said the company should consider putting itself up for sale or embark on a new strategy focusing on takeovers.

Ralcorp, which also sells cookies and pasta under retailers’ own brands, rejected a $5.18 billion takeover bid from ConAgra last year, saying it would spin off its Post Foods unit instead and focus on private-label goods. In May, Ralcorp said it would restate results for fiscal 2011 and the first quarter of 2012 after understating an impairment charge related to the spinoff of Post, which occurred in February.

Corvex, based in New York, said in the filing that the “status quo is unacceptable” and Ralcorp has had “several serious execution issues since the Post separation including disappointing earnings.”

Matt Pudlowski, a Ralcorp spokesman, didn’t immediately return a phone call seeking comment. Teresa Paulsen, a ConAgra spokeswoman, and Nick Graziano, a Corvex senior managing partner, declined to comment.

Ralcorp rose 2.5 percent to $70.05 at 11:17 a.m. in New York. The shares had dropped 5.7 percent this year through yesterday.

To contact the reporter on this story: David Welch in Detroit at dwelch12@bloomberg.net

To contact the editors responsible for this story: Kevin Orland at korland@bloomberg.net; Jeffrey McCracken at jmccracken3@bloomberg.net

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