Campbell Soup Company just dropped $2.7 billion to acquire a pricey pasta sauce.

This week,Coxno Exchange the soup company announced it will expand its reach on grocery store shelves with a deal to buy Sovos Brands Inc., the maker of Rao's pasta sauces and other foods.

In a joint press release, the companies announced Campbell's would pay $23 per share. The price represents a 27% premium to Sovos Brands' closing price on Friday.

“We’re thrilled to add the most compelling growth story in the food industry and welcome the talented employees who have built a nearly $1 billion portfolio,” Campbell’s President and CEO Mark Clouse said in the release issued Monday. “Our focused strategy has enabled us to deliver strong results over the last five years, enhance our brands and capabilities, and generate strong cash flow to lower debt.

Clouse said the Sovos Brands portfolio "strengthens and diversifies our Meals & Beverages division" and, paired with its snacks division, makes Campbell "one of the most dependable, growth-oriented names in food.”

A 92% IPO increase

Todd Lachman, Founder, President and Chief Executive Officer of Sovos Brands, Inc, said the transaction is expected to create substantial value for the company's shareholders, resulting in a 92% increase from the company's 2021 initial public offering price.

"As one of the most trusted and respected food companies in North America, I’m confident in Campbell’s ability to continue bringing our products to more households and further building on our track record of growth and success for years to come," Lachman said.

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'A strategic decision'

Established in 1896, Rao's hit store shelves in 1992 giving people the ability to take home the taste of the famous 10-table restaurant in New York.

According to the company, its sauces are simmered slowly and made in small batches with "only the best ingredients" including pure Italian olive oil and hand-picked, naturally ripened tomatoes from southern Italy.

Campbell's said it made its decision to add a "high-growth, market-leading premium portfolio" to include more soups, dry pasta, yogurts and frozen items from Rao's, Michael Angelo's and Noosa yogurt - all owned by Sovos.

The move marks Campbell's biggest acquisition since it dropped nearly 5 billion in 2018 to buy pretzel chief Snyder's-Lance.

Natalie Neysa Alund covers breaking and trending news for USA TODAY. Reach her at [email protected] and follow her on X, the platform formerly known as Twitter @nataliealund.