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MEMPHIS - ACH Food Companies Inc., a subsidiary of Associated British Foods plc (ABF) today announced that it has signed a definitive agreement to purchase Unilever's Mazola branded cooking oil and corn products business in the United States, Canada and Puerto Rico for $360 million.
The cash transaction is expected to be completed in the third quarter of 2002, subject to regulatory approvals.
ACH will acquire leading consumer brands including Mazola cooking oil, Argo and Kingsford's corn starch, Karo and Golden Griddle syrups, Henri's salad dressings and a number of related Canadian Brands. In addition, ACH is acquiring a manufacturing facility in Illinois, and equipment in New Jersey and Puerto Rico.
Canadian brands to be acquired include Benson's and Canada corn starches, St. Lawrence/St. Laurent corn oil, Crown and BeeHive corn syrups, Old Colony maple syrup and Old Tyme pancake syrup.
Mazola is the number one brand of corn oil in the United States and has been a leader in the salad and cooking oils category since 1911. The Argo, Kingsford's and Karo brands have been category leaders since the early 1900's. The acquisition further strengthens ACH's position as a leading North American player in vegetable oils.
The brands being acquired had combined net sales of $310 million in 2001. In total, approximately 200 employees will be transferred to ACH Food Companies Inc., mostly from a manufacturing facility in Argo, Ill.
ACH, which had combined sales of approximately $740 million in 2001, is also a leading player in the branded foodservice oil sector following its acquisition last year of Procter & Gamble's U.S. Foodservice Shortening and Oils business.
"We are continuing to implement our strategy of establishing leading branded positions in each of our food channels," ACH CEO Dan Antonelli said. "This acquisition gives us a platform to expand into retail branded products in our key product categories."
ACH is also a leader in private label (store brand) vegetable oils in the U.S. This acquisition, which will be fully integrated into ACH's operations, further strengthens its retail position by adding the leading corn oil brand to its portfolio.
ACH is well positioned to add value to the newly acquired brands, according to the company. "We have most of the infrastructure in place to manage these businesses very efficiently," Antonelli said. "To give one example, we will have the ability to combine our private label distribution with that of the acquired businesses, enabling our retail partners to receive more full truckloads and improve management of their inventory."