A cross-section, time-series model of food processing firms examines how profitability is affected by acquiring either firms inside the food industry (i.e., firms within the parent's area of expertise), or outside of the food industry (i.e., conglomerate-type aquisitions). The study concludes that aquiring food firms increases the parent firm's actual profits; while aquiring firms outside of the industry increases only book profits, but negatively impacts shareholder wealth.