Hormel Foods Corporation has taken steps to further expand its foodservice portfolio this week; the company announced the acquisition of Fontanini Italian Meats and Sausages, a branded foodservice business, from Capitol Wholesale Meats, Inc. Hormel acquired the Chicago-based company specializing in authentic Italian meats and sausages, as well as a variety of other premium meat products including pizza toppings and meatballs, for $425 million.
"This is a strategic acquisition for our high-growth foodservice division. We have delivered a strong track record of success in the foodservice industry with a growing portfolio of customers in the lodging, restaurant, healthcare, and college and university sectors," said Jim Snee, President and Chief Executive Officer, Hormel Foods. "The Fontanini® brand is highly regarded, and the addition of these products to our portfolio will allow us to accelerate growth for both Hormel Foods foodservice and for Fontanini through expanded distribution and new customers."
Fontanini will continue operations out of their facility in the Chicago metropolitan area and will report into the Refrigerated Foods segment of Hormel Foods.
"The Fontanini business perfectly complements our branded foodservice business," said Jeff Baker, Group Vice President of Foodservice, Hormel Foods. "We are excited about this new partnership and our ability to leverage key Hormel Foods resources such as R&D, operations, supply chain, and finance to grow this dynamic business. While we are focused on ensuring a seamless transition and continued stewardship of the Fontanini® brand, we are also excited about leveraging their new state-of-the-art production facility, which has additional capacity to produce many Hormel Foods products."
Hormel Foods noted, in a press release, that the transaction was structured as an asset sale with a purchase price of $425 million, subject to customary working capital adjustments.
"Hormel Foods has an excellent reputation as one of the strongest food companies in the world with a track record of successfully acquiring family-owned businesses like ours," said Gene Fontanini, Chief Executive Officer of Capitol Wholesale Meats, Inc. "This acquisition will allow Fontanini to strengthen under the Hormel Foods umbrella given its leadership in retail combined with our shared leadership in foodservice. Through this business, the Fontanini family has left its mark on the world. Partnering with Hormel Foods will allow us to expand that mark. I couldn't be more proud of all that we have accomplished, and I look forward to seeing where we go next."
JoAnne Fontanini, President of Capitol Wholesale Meats, Inc., expressed a similar sentiment and expressed excitement at the possibilities inherent in the acquisition.
"At Fontanini, we strive for our motto–Una Bella Differenza®–or a beautiful difference through the production of the highest quality products our customers have come to expect and love matched by customer service exceeding industry standards,” added JoAnne Fontanini. “I am confident that Hormel Foods will embrace all that makes us special–our products, our employees and our customers. On behalf of our entire family, we are excited about the resources and experience Hormel Foods will bring to Fontanini and look forward to seeing continued growth, well into the future."
Deli Market News will continue to report with more on important news of acquisitions in our industry.