Marzetti has bolstered its sauces portfolio with the acquisition of California-based Bachan’s for $400m.
Bachan’s manufactures Japanese-American-style barbecue and dipping sauces and generated sales last year of around $87m. It was set up in 2019 by Justin Gill and is headquartered in Sebastopol.
Nasdaq-listed Marzetti announced the transaction alongside its latest results today (3 February), which showed second-quarter sales rose 1.7% to $518m. They were up 3.6% year to date at $1.01bn.
Subject to regulatory approval, Marzetti expects to close the deal before its year-end on 30 June.
David Ciesinski, Marzetti’s CEO, said in a statement: “This transaction will reinforce Marzetti’s position as a global leader in sauces by adding a premium brand that is exceptionally well aligned with evolving consumer preferences for global flavours and better-for-you products.
“Over time, we intend to further broaden distribution, support continued product innovation, and thoughtfully extend the brand into new channels and adjacent categories.”
Marzetti’s own retail portfolio comprises its namesake brand of dressings and dips, New York Bakery garlic bread and Sister Schubert’s bread rolls. It also produces products under licence for the foodservice channel such as Subway, Texas Roadhouse, and Chick-fil-A sauces.
Bachan’s founder and CEO Gill added: “Over the last several years, building Bachan’s has allowed me to fulfil my childhood dream of bringing my family’s sauce to market. My team and I have been working incredibly hard to deliver on this vision of building the first iconic Japanese-American flavour brand…”
In other areas of Marzetti’s financial report, sales through retail fell 1.1% in the second quarter to $278m, while out-of-home sales rose 5.2% to $240.4m.
Its consolidated operating income decreased 0.6% to $75.2m. Net income increased 21% to $59.1m, or to $2.15 per diluted share versus $1.78 a year earlier.
Marzetti said it incurred restructuring and impairment charges of $1.7m in the quarter related to manufacturing equipment.
Over the six months, net income climbed 13.5% to $106.3m, or to $3.86 per diluted share, up from $3.40.
Marzetti previously traded as Lancaster Colony under the auspices of Ciesinski before changing its corporate identity last year.
