Investor-backed Tropicale Foods, a US manufacturer of frozen Hispanic products, has acquired Paleteria La Michoacana, a peer company based in California.
Tropicale Foods and its Illinois-based private-equity backers Wind Point Partners, said Paleteria La Michoacana (PLM) is being acquired from fellow investors Canum Capital Partners in San Francisco and Greyrock Capital Group, a buy-out firm in California.
PLM also produces frozen Hispanic products such as paletas (ice pops), bolis (snacks), and mangonada cups (smoothies) sold throughout the US in retailers, convenience stores, and traditional grocers under the brand La Michoacana. The company has one production site, a 45,000 square-foot facility in Modesto, California.
Steven Schiller, the CEO of Tropicale, said: “The cultures of our two companies are very similar, making this a natural partnership. PLM has built a terrific business with a great brand, customer base, team, and operation. Our plan is to invest behind PLM and the La Michoacana brand and leverage our combined capabilities to accelerate growth for our customers.”
Financial terms were not disclosed. The founders of Canum Capital will remain invested in the combined company.
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Located in Ontario, Tropicale also makes paletas under its Helados Mexico brand, along with bolis and mangonada supplied to retailers.
Wind Point invested in the business in 2019 in partnership with snacks industry veteran José Luis Prado, who was once the CEO of Evans Food Group, a manufacturer of branded and private-label pork rind snacks.
"Tropicale will continue to seek strategic acquisition opportunities, with a focus on leading branded frozen novelty businesses," Wind Point said.
The private-equity investor has also previously invested in Stir Foods, a contract manufacturer in California, and Wisconsin-based Gehl Foods, a producer of dairy-based beverages and cheese sauces.
Brandon Gregorio and Robert Spigner, co-founders of Canum Capital, added: "We're proud of the industry-leading growth and operational transformation executed by PLM over the last four years. This combination of strong, recognised brands unites two customer-driven companies with highly complementary capabilities. The financial backing of Wind Point Partners and our continued investment in the combined company will enable a value creation plan that will accelerate growth."