Jan 26, 2017Bob Evans acquires Pineland Farms Potato Company
Bob Evans Farms (BEF) has signed a definitive agreement to purchase Pineland Farms Potato Company for $115 million. The acquisition enables a focus on driving growth of BEF Foods, according to the company.
The purchase price may be increased by up to $25 million if certain financial metrics are achieved during a 24-month period after closing, according to BEF press release.
“The acquisition of PFPC not only increases our side-dish production capacity, it provides capability to produce and sell diced and shredded potato products in both the retail and foodservice channels,” said Saed Mohseni, president and chief executive officer of Bob Evans Farms. “The acquisition also diversifies our production capability by adding a second state-of-the-art potato processing facility with 180 million pounds of capacity, 50 million pounds of which are expected to come online in April 2017.
“PFPC comes with a 900 acre potato farm and is surrounded by an additional 55,000+ acres of annual potato production. Its close proximity to tens of thousands of acres of potato production is particularly attractive as it greatly reduces transportation costs,” Mohseni continued. “BEF Food’s side-dish product mix is expected to reach 66 percent of sales volume by 2020, and the PFPC acquisition mitigates the need for near term capital spending for additional capacity to meet our growth targets. Following the completion of these transactions, Bob Evans will be focused exclusively on sales and profit growth of BEF Foods.”
Bob Evans Farms also entered into a definitive agreement for the sale of Bob Evans Restaurants to an affiliate of Golden Gate Capital for $565 million plus assumption of certain net working capital liabilities at the time of closing estimated to be $40 to $50 million.
“The sale of Bob Evans Restaurants enables us to concentrate exclusively on BEF Foods, our fastest growing and most profitable segment,” said Mohseni.
