Pasco Beverage Group Completes $70 Million Acquisition of McCain Citrus, Inc.
The combined value of the transaction was $70 million. Included in the transaction was the sale of Pasco's "Old South" brand in Canada to McCain Foods (Canada).
Pasco Beverage Group, the private label marketing and manufacturing unit of Vitality Beverages, Inc., will acquire the McCain Citrus private label business, and simultaneously will transfer McCain's single-serve cup business to its Vitality Foodservice affiliated company. The transaction adds approximately $175 million in sales to Vitality Beverages' business mix, bringing its annualized consolidated sales to approximately $800 million, and makes Pasco the leading private label juice supplier in North America.
"The growth of private label juice makes this acquisition of special importance, providing us with greater geographic reach, distribution points closer to our customers, expanded production capacity, and innovative products," said Robert A. Peiser, president and chief executive officer of Vitality Beverages, Inc. "This acquisition provides logical and significant benefits to Pasco as we serve similar customers with a very complimentary product mix. We intend to build on McCain's excellent reputation for quality products and outstanding service. In addition, our plans call for the expansion of McCain's strong line of frozen juices to include an extensive line of refrigerated products that are already a major part of Pasco's product portfolio."
Both companies are privately owned. Vitality Beverages, Inc., is based in Tampa, Florida and has approximately 2000 employees throughout its operating units. McCain Citrus, with over 300 employees, had been part of McCain Foods USA, a subsidiary of McCain Foods Limited, an international corporation based in Florenceville, New Brunswick, Canada. McCain Citrus was formed in 1985 with the purchase of a juice processing plant in Chicago and later expanded through the acquisition of a Hillside, N.J. plant and the construction of a third in Fontana, Calif.
Vitality Beverages was formed in July 1999 through the purchase of certain juice-related businesses to be a platform for making acquisitions in the retail private label juice industry and in the non-carbonated foodservice beverage industry. Vitality's two primary subsidiaries are Pasco Beverage Group, which operates its retail businesses through Pasco Brands, and Vitality Foodservice, Inc., which is a leading provider of a broad range of juice and other beverage products to the foodservice industry. Since its formation, Vitality Beverages' operating units have acquired four companies prior to the acquisition of McCain Citrus, including Pride Beverages, the leading foodservice supplier of juice products in Canada, and the foodservice and processing unit of Orange-co, a leading supplier of juice products to the U.S. foodservice industry. With the McCain acquisition, Vitality will own nine packaging and processing plants throughout the U.S. and Canada.
Vitality is controlled by two private equity investors, New York-based Caxton-Iseman Capital and Dallas-based Engles Urso Follmer Capital Corporation.
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