KINGSTON, Jamaica -- In continuation of its strategy of transforming from a Jamaican trading company to a global consumer group, and to grow exports significantly, GraceKennedy through its wholly owned subsidiary GraceKennedy Foods (USA) LLC has entered into an agreement to purchase the operating assets and business of La Fe Foods Inc., including its brand.
La Fe is the top Hispanic Brand in the frozen food category in Northeast USA. La Fe Foods Inc. which was established in 1968 currently has revenues of approximately US$80 million and the business being acquired will be the platform for the growth of GraceKennedy’s North American business going forward. The acquisition comes at a purchase price of US$26 million.
“This acquisition is a major step in achieving our vision of being a global consumer group,” said GraceKennedy Group CEO, Don Wehby.
“La Fe was attractive to us for several reasons, including its distribution channels across the East Coast USA and its strong relationships with blue-chip retailers across the US. The company has operations in Moonachie, New Jersey; Miami, Florida and Raleigh, North Carolina, with brand and distribution presence in the New York/Tri-state area, Florida, Georgia and the East Coast. Our international business started with the Jamaican Diaspora. We have served them proudly for a very long time, and we will now be able to serve them even better, while catering to a new market for GraceKennedy as well. We are very excited about this acquisition, which we anticipate will be a serious game changer for our food distribution network,” he said.
This strategic acquisition gives GraceKennedy the ability to own its route to market in the US, and presents an opportunity to reach out to consumers in the Hispanic market.
GK Foods CEO, Michael Ranglin, is also excited about the road ahead.
“Among the advantages are La Fe’s manufacturing and distribution capability which can immediately be leveraged. We have also long recognized that the Hispanic food and beverage market, is one of the largest growing segments in the food market in the United States. We see this as providing a significant opportunity for growth,” he said.
Ranglin will be president and CEO of the newly formed subsidiary, while Wehby will be chairman of its board.
The La Fe transaction is the second major acquisition for GraceKennedy outside of Jamaica for the Foods Division, with the first being the acquisition of WT Foods (now Grace Foods UK) in the UK in 2007. Grace Foods UK has shown improved profits and revenue since the 2007 acquisition.
GraceKennedy is one of the Caribbean's largest conglomerates, with several diversified companies in the Caribbean, Europe and North America.
The GraceKennedy Group comprises a varied network of some 60 subsidiaries and associated companies located across the Caribbean and in North and Central America and the United Kingdom. Their operations span the food distribution, financial, insurance, remittance, hardware retailing and food-processing industries.