NEW YORK -- Diamond Foods took its biggest bite yet of the snack business with a $1.5 billion deal to buy the Pringles brand from Procter & Gamble.
The deal is the biggest in a stack of acquisitions for Diamond and will more than triple the size of the maker of Emerald nuts and Pop Secret popcorn.
Adding Pringles will make it a distant second in the snack business to PepsiCo's Frito-Lay, which controls nearly half of the market.
The move also lets P&G complete its exit from all its major food businesses. The maker of Tide and Pampers has sold off Folgers coffee, Jif peanut butter, Crisco Shortening and Sunny Delight drinks in recent years.
The Pringles deal will create a new company under the Diamond Foods name. P&G shareholders will get about 57 percent of the combined company and Diamond shareholders about 43 percent.
Diamond, founded in 1912 by a group of California walnut growers, was known for nuts in shells for most of its history. But since Diamond went public in 2005, an acquisition binge has broadened its array of snacks. It scooped up Pop Secret in 2008 and Kettle potato chips last year.
The Pringles transaction will dwarf those deals, more than tripling Diamond's revenue to about $2.4 billion a year.
"Pringles is an iconic, billion-dollar snack brand with significant global manufacturing and supply chain infrastructure," Diamond CEO Michael Mendes said in a statement.
The deal, which still needs Diamond stockholder approval, is expected to close by the end of the year.