US firm Inventure Foods is to add vegetables to its portfolio with a deal to acquire local firm Fresh Frozen Foods.
Fresh Frozen supplies frozen veg and fruits to retail outlets in the south east of the US and in the Caribbean.
Inventure will pay an initial US$38m, although the deal could see it lay out an extra $3m based on its performance next year.
CEO Terry McDaniel said: “This acquisition allows Inventure to add uniquely positioned frozen vegetables to our healthy, natural portfolio for the first time, while also expanding our individually quick frozen processing capabilities for fruits and vegetables in a new geographic region. The unique location of Fresh Frozen’s processing facility in Thomasville, Georgia will provide year-round freezing operations, which increases our geographic footprint.
In June, Inventure agreed a deal to buy Oregon-based berry processor Willamette Valley Fruit Company.
McDaniel cited Fresh Frozen’s recent sales growth and the expansion of the category. “Fresh Frozen has reported 15% average annual revenue growth over the last three years. Frozen vegetables are a $4.6bn category and the company continues to perform well in the category with a year-over-year increase of over 15% for the last 12 weeks, according to recent IRI data.”
Fresh Frozen president Bill Griffin said Inventure could help the company increase distribution. “Fresh Frozen has established a very strong market position in the Southeast. Inventure is well positioned to help us meet growing demand, increase our footprint into more doors beyond the region, and expand our product offerings to existing retail markets, food service distributors, and industrial customers.”