Europastry is acquiring US business Highland Baking Company as the Spanish bakery group expands its presence in North America.

In a statement today (23 June), Europastry confirmed it has reached an agreement to buy the Illinois-based, family-owned business. Financial terms were not disclosed.

Europastry said the acquisition marks a “defining step” in its North American strategy, bringing together two businesses with “complementary capabilities and products”.

The deal will also lift the group’s annual revenue above €2bn ($2.28bn), it added.

Europastry executive chairman Jordi Galles said: “This transaction is much more than an acquisition: it is the coming together of two companies that share values, a long-term vision and the same approach to business.

“This is an exciting opportunity to create a broader, global bakery business, allowing Europastry and Highland Baking to both achieve their full potential.”

Highland Baking, founded in 1984, supplies bakery products to the foodservice sector. Its portfolio includes hamburger buns, pretzel, ciabatta and pan breads, among other lines.

The company runs two production sites, in Northbrook, Illinois and in Spartanburg, South Carolina.

Highland CEO and representative of the founding family Stuart Rosen said: “We have found in Europastry the perfect partner to take the next step in our development, while preserving our identity and corporate culture.

“This is a truly historic combination with a compelling cultural and strategic fit. The transaction creates new and exciting opportunities for our employees, customers, and suppliers.”

The deal is expected to close in the second half of this year, subject to customary conditions including regulatory approvals.

Europastry plans to launch a “significant” investment programme in the US after completion. The initiative will focus on expanding production capacity and broadening the product portfolio.

The group operates in more than 90 countries and employs over 5,500 people.

Last year, Europastry acquired 60% stake in Thailand-based Art of Baking, which produces ready-to-eat and frozen bakery products.

The company has also made two attempts to launch an IPO but cancelled both due to “heightened volatility” in the market.