TreeHouse to buy Canadian drinks label manufacturer
TreeHouse Foods is set to purchase a Canadian private label manufacturer of powdered drinks, specialty teas and sweeteners Associated Brands for C$187m in an agreement with TorQuest Partners, which owns a majority stake in the firm.
This move will increase retail presence of TreeHouse in private label dry grocery and enables it to launch a line of specialty tea products to complement its single serve coffee business.
Associated Brands currently operates three production facilities in Delta, British Columbia, Canada; Toronto, Ontario, Canada; and Medina, New York.
Financing will be made through borrowings under TreeHouse's existing $750m credit facility.
TreeHouse Foods chairman, president and chief executive officer Sam K Reed said: "We see significant opportunities to expand Associated Brands' sales, while leveraging their strong customer relationships in both retail and industrial channels."
Associated Brands president and chief executive officer Scott Greenwood said: "We are confident that the combination will create distribution and innovation opportunities for both companies."
This transaction is subject to the satisfaction of customary closing conditions and will close in the third quarter of 2013.
The company manufactures dry packaged food products including, flavored drink mixes, specialty tea, hot chocolate drinks and sweeteners.