The transaction is expected to close within the next four to six weeks, subject to customary closing conditions.
“This transaction will create a leading North American platform in the rapidly growing meat snacks product category and will feature Canada’s top meat snack brands, including McSweeney’s, Grimm’s, Freybe, Piller’s and Harvest, as well as Oberto’s iconic family of brands and our fast emerging US based Hempler’s brand,” said Premium Brands’ CEO George Paleologou.
This is the Canadian food producer’s third investment in Washington State, having previously acquired sandwich maker Seattle-based SK Food Group for US$42.5m in 2010, and Hempler Foods Group, a processor of smoked meats based in Ferndale.
According to Paleologou, both companies have prospered under the Premium Brands umbrella “with their combined sales growing from under US$130m in 2011 to over US$560m last year.
“We fully expect Oberto to replicate this type of success by combining its current strengths with access to our various resources,” he added.
Another 100 years
Oberto, meanwhile, embraces the deal and believes it will enable the brand to continue its growth into the future.
“While Oberto has been successful as an independent, family-owned business for 100 years, the marriage with Premium Brands will enhance our ability to grow and thrive for the next 100 years,” said Tom Hernquist, president and CEO of the Seattle-based manufacturer.
“Premium Brands’ entrepreneurial culture and respect for the uniqueness of its individual businesses, combined with its focus on quality, innovation and long term decision making are perfect fits for our business.”
In related news, Premium Brands announced it is increasing its investment on Vancouver-based McLean Meats to 66% from the previous 36.2%. In a statement, the company said its investments in Oberto and McLean is approximately CA$237m (US$187m), while the combined revenues of the two businesses are approximately CA$246m (US$195m).
Oberto manufactures healthy and convenient protein-packed snacks, such as pork snack sticks, trail mix with jerky, beef, bacon and turkey jerky, chicken strips, pepperoni, thin-style beef jerky, and bite-size jerky, under the Oberto, Pacific Gold, Pacific Gold Reserve, Lowrey’s and Cattlemen’s Cut brands.
The family-run company, founded in 1918 by Constantino Oberto, has around 500 employees.