Frozen potato products maker Lamb Weston has entered into an agreement to acquire the remaining equity interests in its European joint venture with Meijer Frozen Foods B.V. for €700 million.
The deal, subject to regulatory approvals, is expected to close in the second half of 2023.
Upon completion, Lamb Weston will own 100% of Lamb-Weston/Meijer v.o.f., formerly a 50/50 joint venture between a wholly-owned subsidiary of Lamb Weston and Meijer Frozen Foods.
The company plans to pay €525 million in cash and €175 million in common stock.
The transaction will see Lamb Weston adding five manufacturing facilities to its operations, including four in the Netherlands and one in the United Kingdom.
It also includes a sixth manufacturing facility through a 75% interest in a joint venture in Austria.
These facilities produce nearly two billion pounds (910,000 MT) of finished frozen products annually.
Tom Werner, President and CEO of Lamb Weston, stated, "This transaction firmly aligns with Lamb Weston’s long-term capital allocation and acquisition framework, and we believe it will strengthen our manufacturing footprint by leveraging a truly global supply chain to better serve our customers and position us to take advantage of growth opportunities in Europe, the Middle East and Africa."
Lamb-Weston/Meijer is one of the top suppliers of frozen potato products in Europe, the Middle East and Africa.
The company hopes to generate approximately €954 million in net sales in its financial year 2022, including €114 million from its former joint venture in Russia.
The acquisition will see approximately 1,500 employees of Lamb-Weston/Meijer become employees of Lamb Weston.
© 2021 European Supermarket Magazine. Article by Dayeeta Das. For more retail news, click here. Click subscribe to sign up to ESM: European Supermarket Magazine.