South American food giant Grupo Nacional de Chocolates is to acquire US cookie manufacturer Fehr Foods for US$84m.
Grupo Nacional de Chocolates said that the acquisition is a “positive step” for the company and that it will continue to develop the Fehr business further.
Additionally, the firm said that Fehr’s proximity to centres of wheat production, a major raw material of the biscuit business, will bring “major economies” and allow it to develop its supply chain to Colombia and Costa Rica.
Fehr produces and markets cookies through two production platforms located in Texas and Oklahoma. Products are sold under the brand names Lil ‘Dutch Maid, Sun Valley and Tru-Blu, which are available in 43 US states, Mexico and Panama.
The agreed sale price is subject to Fehr’s operating performance for the current fiscal year. If set targets are not achieved, there will be a discount of up to $4m.
To finance the transaction, Grupo Nacional de Chocolates has used its own resources and bank loans secured by a number of its subsidiaries.
The closing date is expected to be in October.