It procured Island City Baking and its affiliate Conte Foods for $20.3m, subject to a closing net working capital adjustment. In a separate transaction, it acquired Larosa Fine Foods for $700,000.
Both deals are expected to be immediately accretive to both Premium Brands’ earnings per share and free cash flow per share on an annual basis.
According to George Paleologou, president and CEO of Premium Brands Holdings Corporation, both Island City and Conte Foods have built strong reputations, making them a perfect fit with Premium.
Island City Baking, which was founded in 1990, produces a range of fresh and frozen artisan breads at its 45,000 square foot production facility in Richmond, BC.
Conte Foods is a distributor of specialty food products, including imported European foods. The company also manufactures fresh pasta at its 16,000 square foot facility located in Burnaby, BC.
Under the leadership of president Carmelo De Luca, the two companies realize combined annual sales of around $20m.
Larosa, a manufacturer and wholesaler of specialty Italian products with annual sales of $4m, has also been purchased by Premium Brands and will be merged with Conte Foods.
Paleologou said the combined business will position Premium Brands in the 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 US,” he added.
De Luca will keep his position of president, assisted by An Nguyen, senior VP of operations. Employees of all three companies will also be retained.
Premium Brands owns a broad range of specialty food manufacturing and differentiated food distribution businesses, including Harvest, McSweeney's, Ocean Miracle, C&C Packing and Premier Meats, among many others.