6 Buzzworthy Foodservice Acquisitions in 2017

CHICAGO -- Major mergers and acquisitions are changing the game for the convenience segment overall, but from a category-specific point of view, foodservice-centric purchases and deals are also bringing about new growth opportunities for companies along the supply chain.

Some immediate takeaways from these acquisitions point to companies extending their presence further into convenience stores, finding complementary brands that broaden their product ranges and using acquisitions to gain a stronger foothold in new markets.

Take a look back at the 2017 acquisitions that will continue to influence strategic developments for c-store foodservice into 2018 and beyond ...

In April, Tyson and AdvancePierre entered into a definitive merger agreement in a deal worth approximately $4.2 billion.

AdvancePierre, Cincinnati, is a leading national producer of ready-to-eat lunch and dinner sandwiches, sandwich components and snacks, with product categories that are complementary to Springdale, Ark.-based Tyson’s current offerings. Its portfolio fits well with Tyson’s strategy to expand its fresh prepared-foods offering for both out-of-home and in-home eating occasions.

The collective portfolio of sandwiches, sandwich components, entrees and snacks will extend Tyson’s core strength into the convenience-store and retail perimeter with solutions that span all dayparts.

In August, Northlake, Texas-based Farmer Brothers Co., a national coffee roaster, wholesaler and distributor of coffee, tea and culinary products, announced plans to purchase convenience-store supplier Boyd Coffee Co. According to a company statement, the purchase price totaled up to $42 million in cash and 21,000 shares of new preferred stock.

Farmer Brothers plans to move Boyd’s production volume into its existing facilities; the full transition and integration process is expected to be completed in the next 12 to 18 months.

“We believe the Boyd’s business will be an excellent strategic fit for Farmer Brothers,” said Mike Keown, CEO of Farmer Brothers. “We expect this acquisition will strengthen our position in the marketplace, expand our distribution footprint and generate significant synergies.”

“We are confident Farmer Brothers is the right company to take the Boyd’s brand to the next level,” said Jeffrey Newman, CEO of Boyd. “We look forward to a smooth transition and providing the same high-quality customer service that has been a hallmark of the Boyd Coffee Co. for over 100 years.”

In October, Home Market Foods, a leading provider of foodservice products to the convenience-store industry, acquired Kelly Corned Beef Co., also known as Kelly Eisenberg. Founded in 1929, Kelly Eisenberg is the producer and distributor of the Eisenberg brand of gourmet-style sausages and the Kelly brand of corned beef, as well as USDA beef products and fresh seasonings.

Douglas Atamian, CEO of Norwood, Mass.-based Home Market Foods, lauded the deal as an opportunity for Home Market to “provide an even broader array of product offerings and innovation” to the companies’ combined customer bases.

Cliff Eisenberg, CEO of Chicago-based Kelly Eisenberg, said, “We chose to work with Home Market Foods because they have the best capabilities to support our customers and people.”

In November, Tyson Foods Inc. completed its acquisition of Philadelphia-based Original Philly Holdings Inc., a producer of raw and fully cooked Philly-style sandwich steak and cheesesteak appetizer products.

“Original Philly Holdings is a natural, strategic fit with our prepared-foods business,” said Sally Grimes, president of Tyson Foods’ Prepared Foods Group. “The Original Philly brand and portfolio of products are highly regarded in the foodservice industry and have a growing list of customer relationships with chain and convenience-store operators.”

Original Philly Holdings consists of two divisions: Original Philly Cheesesteak Co., which manufactures raw Philly-style sandwich steak products, and Philadelphia Pre-Cooked Steak Co., which manufactures fully cooked Philly-style sandwich steak products.

In May, convenience-store operator GPM Investments LLC took ownership of Broyles Hospitality, the Johnson City, Tenn.-based franchisee that operates seven Dunkin’ Donuts quick-service restaurants in Tennessee and Virginia.

This acquisition will further develop GPM’s existing portfolio in the Southeast region, the company said.

"These Dunkin’ Donuts restaurants are very well-established within the community and their employees have served customers with dedication and enthusiasm. We are eager to remain on the same path of service with passion and commitment,” said Arie Kotler, CEO of GPM. “Bringing the Broyles Hospitality employees into the GPM family was very important to our leadership team, and we look forward to our continued development.”

In February, US Foods, a foodservice distributor for restaurants and retail foodservice operators, agreed to acquire All American Foods, a broadline distributor based in North Kingstown, R.I., with annual sales of nearly $60 million.

All American Foods was established in 1988 and has grown to offer more than 4,000 SKUs to nearly 1,000 customers in Rhode Island, Massachusetts and Connecticut. US Foods said it will continue to operate out of its current 65,000-square-foot facility.

In announcing its purchase of All American Foods, US Foods said that the deal further enhances its ability to serve customers in the Northeast, an area of the country heavily populated with independent foodservice operators.

“The growth All American Foods has experienced over the last three decades is proof that their business model and commitment to customer service is strong,” said John O’Carroll, Northeast region president for US Foods. “We are looking forward to building on All American Foods’ already strong reputation and bringing an even better experience to foodservice operators throughout southern New England."

Illinois-based foodservice distributor US Foods works with nearly 250,000 retailers, chefs and restaurateurs. With nearly 25,000 employees and more than 60 locations, the company generates approximately $23 billion in annual revenue.