VANCOUVER, B.C. — Premium Brands Holdings Corp., a producer and distributor of specialty food products, has acquired Island City Baking and its affiliate Conte Foods for C$20.3 million ($15.3 million). The amount consisted of C$13.3 million in cash, C$3 million in Premium Brands common shares and a minority equity stake in the Premium Brands’ bakery group.
Island City Baking is a manufacturer of fresh and frozen artisan bread, including traditional sandwich loaves, traditional rolls, ryes and sours, ciabattas and baguettes, and rustic loaves. The company operates out of a 45,000-square-foot production facility located in Richmond, B.C., and serves retail and food service customers across southern B.C.
Conte Foods is a distributor of specialty food products, including items imported from Europe and pasta produced at its 16,000-square-foot facility in Burnaby, B.C. Combined, Conte and Island City have annual sales of approximately C$20 million.
“We are very pleased to welcome Carmelo De Luca, president of Island City, An Nguyen, senior vice-president of operations for Island City, and the rest of their team to Premium Brands,” said George Paleologou, president and chief executive officer of Premium Brands. “Both Island City and Conte Foods have built strong reputations for manufacturing great, high-quality products and providing exceptional service to their customers. The dynamic and entrepreneurial cultures that Carmelo and An have developed at Island City and Conte Foods make these businesses a perfect fit with Premium Brands.”
Additionally, in a separate transaction, Premium Brands acquired the business and assets of Larosa Fine Foods, a manufacturer and wholesaler of specialty Italian products, for C$700,000 in cash. Larosa, which has annual sales of approximately C$4 million, will be moving its operations from Vancouver, B.C., into Conte Foods’ Burnaby facility.
“We are very excited about the opportunities that will result from the merger of Conte Foods and Larosa,” Mr. Paleologou said. “The new combined business, which will be under the leadership of Carmelo De Luca, will position us well in a fast-growing, niche segment of the specialty food space. Furthermore, we expect to accelerate its growth by enabling it to leverage Premium Brands’ resources, including our extensive sales and marketing infrastructure in Canada and the U.S.”Both transactions are expected to be immediately accretive to both Premium Brands’ earnings per share and free cash flow per share on an annual basis, the company said.