Specialty foods distributor
United Natural Foods, Inc.
) has signed a definitive agreement to acquire to acquire all the
equity interests of Trudeau Foods, a Minnesota-based distributor
of natural, organic and specialty food products. Though the
transaction details were not disclosed, the deal is expected to
close on Sep 30, 2013. Post-acquisition, Trudeau Foods will
become a wholly-owned subsidiary of United Natural.
Trudeau Foods is owned by Trudeau Holdings, LLC, a portfolio
company of Arbor Investments. The deal is a strategic fit for
United Natural, which is looking to enhance its position and
increase its market share in the specialty products industry.
Following the deal, United Natural will have the opportunity to
expand its products in the markets of Minnesota, North Dakota,
Wisconsin and Michigan's Upper Peninsula, where Trudeau Foods has
Trudeau Foods distributes a full range of fine-quality and
specialty gourmet meats, frozen foods, dairy, bakery, deli,
seafood and dry grocery items, which will strengthen the
company's product portfolio in the market. On the other hand,
Trudeau Foods will have the benefit to expand its product
portfolio using the company's strong distribution network.
United Natural has taken the inorganic route to grow its
distribution network, customer base and boost long-term growth.
During the first quarter of fiscal 2013, the company completed
three business combinations within its wholesale segment. Earlier
in Jun 2010, the acquisition of certain Canadian food
distribution assets of SunOpta Inc. made the company the largest
distributor of natural, organic and specialty foods, including
kosher foods, in Canada.
With the increasing demand for a healthy lifestyle, food
safety and environmental sustainability, the demand for organic
products is growing rapidly. Moreover, it is believed that the
growth rate of the natural products industry has outpaced the
growth of the overall food-at-home industry.
The increased demand for organic products is also reflected in
higher sales of the company's fourth quarter of fiscal 2013
results. United Natural's earnings and sales surged a respective
27.5% and 22.2% year over year on the back of continuous increase
in demand for the company's organic and natural food
United Natural currently holds a Zacks Rank #3 (Buy). Other
stocks in the food industry worth considering are
Green Mountain Coffee Roasters, Inc
Boulder Brands Inc.
Pinnacle Foods Inc
). While Green Mountain and Pinnacle Foods hold a Zacks Rank #1
(Strong Buy), Boulder Brands holds a Zacks Rank #2 (Buy).
BOULDER BRANDS (BDBD): Free Stock Analysis
GREEN MTN COFFE (GMCR): Free Stock Analysis
PINNACLE FOODS (PF): Free Stock Analysis
UTD NATURAL FDS (UNFI): Free Stock Analysis
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