Horizon Organic Holding Corp., the nation's leading producer of organic dairy products, announced today the acquisition of Mid England-based Organic Matters Ltd. Organic Matters provides a wide range of branded dairy products including fluid milk, butter, cottage cheese, cream cheese, cream and ultra pasteurized (UP) milk to supermarket and health food stores throughout the United Kingdom with a concentration in the greater London area.

Horizon Organic will pay nearly $2 million for Organic Matters, which is less than half of 2000 projected sales. The financing for Organic Matters is included in the previously announced bank line from U.S. Bank also used for the acquisition of Meadow Farms.

"The acquisition of Organic Matters allows us to accelerate the introduction of Horizon Organic™ branded milk in London's specialty food stores," said Charles F. Marcy, president and chief executive officer of Horizon Organic. "We will convert Organic Matters to the Horizon Organic brand fairly quickly and anticipate availability on supermarket shelves in early 2001."

Organic Matters currently distributes its branded dairy products to most regional London supermarket chains and supplies food-service dairy products to Pret-a-Manger, a natural fast food restaurant chain in London. The acquisition also extends Horizon Organic's supplies of raw milk in the important Mid England region.

According to Marcy, the acquisition is synergistic with the company's June 1, 2000 acquisition of Meadow Farms. For example, the excess capacity at the Meadow Farms' processing plant in Honiton, England can quickly be utilized for Organic Matters production, which will result in cost savings beginning in early 2001. Additionally, Meadow Farms and Organic Matters service some of the same customers, providing additional relationships on which Horizon Organic can build.

"This acquisition enhances the value of our Meadow Farms purchase announced earlier this month. It allows us to achieve additional economies of scale and spread our operating costs over a larger U.K. business base. The Organic Matters acquisition will have negligible impact on our P&L this year but we do anticipate it will be accretive to earnings in 2001," Marcy concluded.

Horizon Organic produces and markets the leading brand of certified organic milk and a full line of refrigerated, certified organic dairy products. The company also markets certified organic eggs and certified organic juices under the Horizon Organic™ label. Additionally, the company produces The Organic Cow of Vermont® brand of organic dairy products in the northeast region of the United States and Rachel's Organic™ brand yogurt in the United Kingdom. It also is the largest producer and supplier of private label organic milk to the leading supermarket chains in the U.K. In addition to its company-owned farms, Horizon Organic has established a network of organic milk producers, processors and distributors that allows consumers to purchase Horizon Organic products in conventional supermarkets and natural foods stores located across the United States and in the U.K.