Avocado specialist Calavo Growers has announced that its Renaissance Food Group (RFG) subsidiary has signed a definitive agreement to acquire Simply Fresh Fruit (SFFI).
Founded in 1999 and based in Vernon, California, privately held SFFI is a processor and supplier of a broad line of fresh-cut fruit, principally serving the foodservice and hospitality markets.
According to Calavo, its focus in those industries is anticipated to be highly complementary to the retail-grocery expertise of Calavo’s RFG business segment.
SFFI generated more than US$30m in annual sales in its most recent fiscal year.
The transaction, which is subject to customary closing conditions, is expected to close in Calavo’s first half and to be accretive to the company’s fiscal 2020 adjusted earnings per share.
“The purchase of Simply Fresh Fruit and its combination into the larger RFG platform makes sense on every level," explained chairman, president and CEO Lee Cole. "SFFI has built an impressive business, both operationally and financially. It enables Calavo to efficiently add volume on favourable terms across existing RFG production facilities.
"With its concentration in the foodservice and hospitality industries, SFFI provides us with a profitable, ‘pure-play’ vehicle for accelerating the company’s growth in these additional categories, and expands RFG’s total potential addressable market for its core fresh-cut fruit business," he added. "We look forward to SFFI becoming part of the Calavo family."