Ireland’s Greencore said today (17 April) that it plans to build on its presence in the US through the acquisition of convenience food firm Marketfare Foods for US$36m.
Marketfare manufactures food-to-go products for c-stores in the US and its principal customer is retailer 7-Eleven. The company is the largest single supplier of Fresh to Go and 7-Smart store-branded sandwiches and is an exclusive manufacturer of Casa Buena Cheese and Chili sauces for 7-Eleven chain in the US and Canada.
For the year ended 27 January 2012, Marketfare generated revenue of $65m and EBITDA of $5.7m. Gross assets were $20.1m, Greencore added.
The transaction will be funded from existing debt facilities and is expected to complete tomorrow, the company revealed.
Greencore said the deal is expected to be “modestly earnings accretive” from the first financial year of ownership. Integration and transaction expenses are estimated at $3.5m and will be treated as an exceptional item.
“The acquisition of Marketfare represents an excellent opportunity for us to further develop our food to go business in the US, building on the successful acquisition of On a Roll in December 2010,” Greencore CEO Patrick Coveney said.
“It builds additional scale with 7-Eleven, provides new competencies for us in the fast growing food-to-go category and extends our geographic footprint principally along the Eastern seaboard. The new product capability and geographic expansion provide the opportunity to expand further with our existing customers; the acquisition represents the next step in our strategy to build a business of real scale in the US.”
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