US cereal company Kellogg agreed this week to sell its Bake-Line Products business to Atlantic Baking Group, the privately held baking group said on Wednesday.
Kellogg had acquired Bake-Line as part of its purchase of Keebler Foods last year. The Atlantic Bakery acquisition includes Keebler's Marietta, Oklahoma, bakery as its primary manufacturing facility, but does not include a bakery in Des Plaines, Illinois, which will remain with Keebler.
Oakbrook, Illinois-based Atlantic Baking also said it will buy four baking facilities from Consolidated Biscuit for an undisclosed amount.The CBC transaction includes bakeries in Birmingham, Alabama; North Little Rock, Arkansas, and two bakeries in South Beloit, Illinois.
Three of the four CBC plants are biscuit bakeries that mostly make products for the private label - or store-brand - and regional value brand business, the company said.
"With the combination of Bake-Line, the Marietta bakery, the CBC facilities, and the Pittsburgh cracker bakery, ABG will become the number one supplier in the private label biscuit category and number two overall in the private label biscuit industry," said David Shanholtz, Atlantic Baking's president and chief executive.
Both purchases are expected to close within 30 to 60 days, and the company said it expects to make more acquisitions as part of its growth strategy.
"Private label is a growing part of the market," Shanholtz said. "There has been a lot of consolidation among retail supermarkets over the years and private labels are a way for them to differentiate themselves...it gives the consumer a reason to shop in a specific store."
Terms of the Bake-Line Products acquisition were not disclosed.