AUSTIN, TEXAS — Private equity firm Peak Rock Capital has entered a definitive agreement to acquire the Turkey Hill business from the Kroger Co. Financial terms of the transaction were not disclosed.
Turkey Hill produces iced teas, fruit drinks, milk, frozen dairy treats and ice cream products at a manufacturing and distribution facility in Conestoga, Pa., with nearly 800 full-time, part-time and seasonal employees. Cincinnati-based Kroger has owned Turkey Hill since 1985 and announced this past August plans to explore strategic options for the business, including a potential sale.
“We believe this is the right step to ensure the Turkey Hill business can meet its full potential and continue to grow its successful ice cream and beverage brands,” said Erin S. Sharp, group vice-president for Kroger Manufacturing. “Throughout this process, we were extremely impressed with Peak Rock’s professionalism and vision for the future of the Turkey Hill business. We look forward to working with them to ensure a smooth and successful transition for all parties.”
As part of the agreement, Peak Rock Capital will continue to operate the business at the Conestoga facility and under the Turkey Hill brand name. The acquisition is expected to close during Kroger’s first quarter, and the after-tax proceeds will be used to reduce debt. The transaction remains subject to customary closing conditions.
“Turkey Hill represents an exciting opportunity to invest in a premier brand with an established reputation for quality, flavor variety and authenticity, within the large and growing ice cream and refrigerated drinks space,” said Robert Pistilli, managing director of Peak Rock Capital. “We are impressed with the accomplishments of the business under the stewardship of Kroger and look forward to completing a seamless transition of the business to a standalone entity and partnering with Turkey Hill’s management team to drive significant growth through continued product innovation.”
The acquisition represents Peak Rock Capital's eighth current investment in the food and beverage industry. Others include Berner Food & Beverage, Diamond Crystal Brands, Gold Coast Bakeries, Louisiana Fish Fry, Pretzels Inc., Sweet Harvest Foods and TNT Crust.