HANOVER, PA. — Subsidiaries of Utz Brands, Inc. have agreed to acquire the equity and certain real estate assets related to the operation of RW Garcia from RW Garcia Holdings, LLC and related entities for $56 million. A family-owned company based in Scott’s Valley, Calif., RW Garcia makes organic tortilla chips, crackers and corn chips that are verified non-GMO, certified gluten-free, and free of artificial additives or preservatives.
“We expect this strategic acquisition will enable strong supply chain synergies, enhance our ability to expand distribution of our existing brands, and supplement our better-for-you product portfolio,” said Dylan Lissette, chief executive officer of Hanover-based Utz Brands. “RW Garcia has a great track record of better-for-you innovation and production capabilities, and with the RW Garcia brand as part of our portfolio, Utz’s retail sales in the better-for-you segment will exceed $100 million on an annual basis following the closing. We believe this strategic combination will help accelerate the growth of Utz’s brands and expand margins over the long-term, and we look forward to continuing to serve Garcia’s existing customers.”
Utz Brands will use balance sheet cash and its revolving credit facility to fund the acquisition, which is expected to close in the fourth quarter. Utz Brands has increased its presence in the snacks category recently through the acquisitions of certain assets of the H.K. Anderson business announced in September of 2020, certain assets of the Vitner’s brand announced in January and all the assets of Festida Foods announced in May.
RW Garcia generated net sales of about $66.2 million and adjusted EBITDA of about $5.8 million in the fiscal year ended June 30. RW Garcia manufacturing facilities in Nevada and North Carolina will help support the continued growth of the Utz portfolio of brands, according to Utz Brands.
“The RW Garcia team is thrilled to be joining the Utz family,” said Robert Garcia, founder and CEO of RW Garcia. “As a premier supplier of tortilla chips, crackers and corn chips to retailers in North America, we believe Utz will be well-positioned to leverage RW Garcia’s manufacturing footprint and capacity to support its brands across the US. Moreover, the Utz platform will enable our better-for-you RW Garcia branded product line to reach more retailers and consumers.”