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Oatly Forms Partnership With Ya YA Foods; Toni Petersson and Yahya Abbas Comment

Oatly Forms Partnership With Ya YA Foods; Toni Petersson and Yahya Abbas Comment


MALMÖ, SWEDEN & TORONTO, CANADA
Wednesday, January 4th, 2023

A strategic partnership was recently formed between Oatly Group AB and Ya YA Foods Corporation. The hybrid partnership will allow Oatly to produce its proprietary oat base at both the Ogden, Utah, and Fort Worth, Texas, facilities before being transferred to Ya YA Foods to be co-packed into Oatly products on-site at each location.

Toni Petersson, Chief Executive Officer, Oatly“We are excited to partner with Ya YA Foods, a leading food and beverage manufacturer who brings deep production expertise and shares our commitment to meeting the highest quality product and safety standards,” Toni Petersson, Oatly’s Chief Executive Officer, commented. “We believe an increased focus on our oat base technology, innovation, branding, and commercial execution will better position Oatly to drive profitable growth while reducing the capital intensity of our future facilities, and ultimately convert more consumers to plant-based and create more products that are healthy for people and the planet.”

As part of the agreement, Ya YA Foods will acquire a majority of the assets used in the operation, assume the property lease at Oatly’s production facility in Ogden, and assume responsibility for the completion of construction of the production facility and the lease in Fort Worth. Oatly will retain full ownership and operation of proprietary oat base production lines in each facility.

Oatly has partnered with Ya YA Foods to expand its distribution and drive profitable growth

Under the terms, noted the release, Oatly will receive approximately $72 million toward future use of shared assets related to the Ogden facility. Oatly will also receive an additional credit toward ongoing construction at the Fort Worth location. The transaction is expected to close in the first quarter of 2023.

Yahya Abbas, Chief Executive Officer, Ya YA Foods“We look forward to working with Oatly and supporting their transition to a more asset-light model, allowing them to leverage our significant expertise in aseptic beverage packaging,” Yahya Abbas, CEO of Ya YA Foods, said. “We are pleased that Oatly recognizes our top-tier food safety track record and unique capabilities and has confidence in our ability to meet their high standards. We expect this transaction to enhance our growth and further strengthen our capabilities: the two properties we are acquiring will increase our geographic profile and scale, allowing us to serve the vast majority of the United States and Canada. This highly strategic partnership with Oatly is a key step toward achieving our goal of becoming the leading aseptic beverage co-manufacturer in North America.”

This announcement is part of Oatly’s shift toward an asset-light supply chain strategy to expand its hybrid production network globally to better support its growth, capacity needs, and product and format innovations. The company expects this hybrid partnership to result in future capital expenditure savings and have a net positive effect on its cash flow outlook. The partnership also marks Ya YA Foods’ entry into the U.S. manufacturing market.

For more information on the partnership, click here.

Deli Market News will keep an eye on the latest partnerships, acquisitions, and expansions in the industry, so check back for the latest.

OatlyYa YA Foods
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