SpartanNash Stock Turns Up Post $217M Caito Acquisition
GRAND RAPIDS, MI - SpartanNash’s stock has seen a consistent uptick since revealing an expanded interest in produce with the $217 million acquisition of Caito Foods Service last Friday, November 4.
"We are excited about this opportunity to expand our presence in serving some of the fastest-growing categories in grocery, including fresh produce, value-added fruits and vegetables, and protein-based prepared food," said Dennis Edison, SpartanNash's CEO and Chairman of the Board, in a press release. "Caito Foods Service is a premier distributor with best-in-class food processing facilities, including its new Fresh Kitchen. In addition, Caito's service area is complementary to our current distribution footprint, and we look forward to serving customers in new areas in addition to enhancing our offerings to existing customers."
Edison continued, "In short, this acquisition further strengthens our platform and enhances our ability to help our customers serve their consumers, benefiting our associates and the communities we serve, as well as delivering value for shareholders."
The retailer’s stock went up from $27.46 per share to $28.71 when the acquisition was announced Friday, the largest spike it’s seen this quarter.
As of today, Nov. 7, the company’s numbers were still up to $28.60 as of 12:41 p.m. EST, +2.38%.
At the close of the deal, Caito and affiliate Blue Ribbon Transport will become part of SpartanNash’s distribution segment. The company noted that this move will strengthen its product offerings by expanding into the “fast-growing freshly prepared centerplate and side dish categories.”
A leading supplier of fresh fruit and vegetables to grocery retailers and foodservice distributors, Caito brings with it:
- A distribution base spanning 22 states in the Southeast, Midwest, and Eastern United States
- Combined annual revenue with BRT in excess of $600 million
- A central fresh-cut fruit and vegetable facility in Indianapolis
- Near-completed new 118,000-square-foot Fresh Kitchen facility, also in Indianapolis
- Fresh Kitchen ($32 million) that is expected to be fully operational in the first quarter of 2017, set to process, cook, and package fresh protein-based foods and complete meals
Caito President Robert Kirch and Blue Ribbon Transport President David Frizzell, as well as others from the company’s senior leadership team, will be joining SpartanNash as well.
"With our long history and family tradition of processing and distributing fresh, convenient, healthy foods, we are excited and proud to join an organization that shares our passion and commitment to serve customers with the freshest foods,” Kirch commented. “We are looking forward to joining the SpartanNash family to expand and enhance our combined ability to deliver high-quality fresh products efficiently to a greater number of customers across the country."
With the retailer due to announce its third quarter Fiscal Year 2016 and further plans for the fourth quarter later this week, AndNowUKnow will continue to report on this and other strategic moves in the industry.