NORTHLAKE, TEXAS — Farmer Bros. Co. (Farmer Brothers), a coffee roaster, wholesaler and distributor of coffee, tea and culinary products, has entered into an agreement to acquire substantially all the assets of Boyd Coffee Co. (Boyd’s) for $58.6 million. The purchase price consists of $42 million in cash plus preferred stocks. The transaction is expected to be in the fourth quarter of calendar 2017.
Founded in 1900 in Portland, Ore., Boyd’s provides coffee, tea and other beverages to restaurants, hotels and convenience stores. Boyd’s generated approximately $95 million in revenue during the previous 12-month period, with coffee accounting for 65% of its sales. Boyd’s sold about 16 million lbs of green coffee during the last year, the company said.
|Mike Keown, c.e.o. of Farmer Brothers|
“We believe the Boyd’s business will be an excellent strategic fit for Farmer Brothers,” said Mike Keown, chief executive officer of Farmer Brothers. “We expect this acquisition will strengthen our position in the marketplace, expand our distribution footprint, and generate significant synergies.”
Once fully integrated, Farmer Brothers expects the acquisition of Boyd’s to deliver between $13 million to $16 million in annual incremental adjusted EBITDA, Farmer Brothers said. The integration is expected to be completed in 12 to 18 months.
“The company expects to improve overall operational efficiency by moving the production volume associated with the acquired Boyd’s business into its existing production facilities,” Farmer Brothers said. “Boyd’s business model is expected to be complementary to Farmer Brothers across customer channels, product portfolios and distribution networks, including a high-touch service model of direct-store delivery.”Founded in 1912, Farmer Bros. Co. is a direct distributor of coffee to restaurants, hotels, casinos, offices, quick-service restaurants convenience stores, health care facilities and other food service providers, as well as private brand retailers. The company offers organic, Direct Trade and sustainably produced coffee as well as hot and iced teas, cappuccino mixes, spices and baking/biscuit mixes. Farmer Brother’s brands include Farmer Brothers, Artisan Collection by Farmer Brothers, Superior, Metropolitan, Cain’s, McGarvey and China Mist.