Strategic Acquisition to Expand UNFI’s Conventional and Organic
Produce Presence on the West Coast
Transaction Expected to be Accretive to Fiscal 2017 Earnings
PROVIDENCE, R.I.--(BUSINESS WIRE)--Mar. 31, 2016--
United Natural Foods, Inc. (Nasdaq: UNFI) (the “Company”) today
announced that it had acquired all the outstanding stock of Nor-Cal
Produce, Inc. (“Nor-Cal”) and an affiliated entity as well as certain
real estate, in a cash transaction for approximately $68.6 million,
subject to certain customary post-closing adjustments. Founded in 1972,
Nor-Cal is a family owned and operated distributor of conventional and
organic produce and other fresh products in Northern California, with
primary operations located in West Sacramento, CA. Annual net sales for
Nor-Cal for the twelve months ended February 29, 2016 were approximately
$151 million. The acquisition further highlights UNFI’s continued drive
into fresh and, when combined with the Company’s existing produce
operations, gives the Company a national presence in produce. The
transaction is expected to be accretive to the Company’s earnings in
fiscal 2017. The Company financed the purchase price with a combination
of available cash and borrowings under its revolving credit facility.
“We are excited to expand the breadth of our fresh perimeter product
assortment and distribution network with the acquisition of Nor-Cal,”
commented Steven Spinner, UNFI’s President and Chief Executive Officer.
“This acquisition further illustrates UNFI’s growth into fresh and we
look forward to working with Todd Achondo, President of Nor-Cal, who
will remain at the company in a leadership role, and their entire team.”
“The entire Nor-Cal team is excited to be a part of UNFI. We look
forward to working together to grow the combined company and better
serve our customers nationwide,” stated Mr. Achondo.
About United Natural Foods
United Natural Foods, Inc. carries and distributes more than 85,000
products to more than 40,000 customer locations throughout the United
States and Canada. The Company serves a wide variety of retail formats
including conventional supermarket chains, natural product superstores,
independent retail operators and the food service channel. United
Natural Foods, Inc. was ranked by Forbes Magazine in 2014 as one of
“America’s Best Managed Companies,” ranked by Fortune in 2012 as one of
its “Most Admired American Companies,” and chosen by Food Logistics
Magazine as one of its 2013 Top 20 Green Providers.
For more information on United Natural Foods, Inc., visit the Company’s
website at www.unfi.com.
Safe Harbor Statement under the Private Securities Litigation Reform
Act of 1995: Statements in this press release regarding the Company’s
business that are not historical facts are “forward-looking statements”
that involve risks and uncertainties and are based on current
expectations and management estimates; actual results may differ
materially. The risks and uncertainties which could impact these
statements are described in the Company’s filings under the Securities
Exchange Act of 1934, as amended, including its annual report on Form
10-K filed with the Securities and Exchange Commission (“SEC”) on
September 30, 2015, its quarterly reports on Form 10-Q filed with the
SEC on December 10, 2015 and March 10, 2016 and other filings the
Company makes with the SEC, and include, but are not limited to the
occurrence of any event, change or other circumstance that could give
rise to the termination of the acquisition agreement entered into by the
parties in connection with the Company’s proposed acquisition of Haddon
House Food Products, Inc.(“Haddon”); the ability of the Company to
consummate the proposed acquisition of Haddon; the Company’s ability to
successfully deploy its operational initiatives to achieve synergies
from the Haddon and Nor-Cal acquisitions; the Company’s dependence on
principal customers; the Company’s sensitivity to general economic
conditions, including the current economic environment; changes in
disposable income levels and consumer spending trends; the Company’s
ability to reduce its expenses in amounts sufficient to offset its
increased focus on sales to conventional supermarkets and the shift in
the Company’s product mix as a result of its acquisition of Tony’s Fine
Foods and the resulting lower gross margins on those sales; the
Company’s reliance on the continued growth in sales of natural and
organic foods and non-food products in comparison to conventional
products; increased competition in our industry as a result of increased
distribution of natural, organic and specialty products by conventional
grocery distributors and direct distribution of those products by large
retailers; the Company’s ability to timely and successfully deploy its
warehouse management system throughout its distribution centers and its
transportation management system across the Company; the addition or
loss of significant customers; volatility in fuel costs; the
Company’s sensitivity to inflationary and deflationary pressures; the
relatively low margins and economic sensitivity of the Company’s
business; the potential for disruptions in the Company’s supply chain by
circumstances beyond its control; the risk of interruption of supplies
due to lack of long-term contracts, severe weather, work stoppages or
otherwise; consumer demand for natural and organic products outpacing
suppliers’ ability to produce those products; decreased forward buying
opportunities; union-organizing activities that could cause labor
relations difficulties and increased costs; the ability to identify and
successfully complete acquisitions of other natural, organic and
specialty food and non-food products distributors; and management’s
allocation of capital and the timing of capital expenditures. Any
forward-looking statements are made pursuant to the Private Securities
Litigation Reform Act of 1995 and, as such, speak only as of the date
made. The Company is not undertaking to update any information in the
foregoing reports until the effective date of its future reports
required by applicable laws. Any projections of future results of
operations are based on a number of assumptions, many of which are
outside the Company’s control and should not be construed in any manner
as a guarantee that such results will in fact occur. These projections
are subject to change and could differ materially from final reported
results. The Company may from time to time update these publicly
announced projections, but it is not obligated to do so.
View source version on businesswire.com: http://www.businesswire.com/news/home/20160331006404/en/
Source: United Natural Foods, Inc.
United Natural Foods, Inc.
Michael Zechmeister
Chief
Financial Officer
(401) 528-8634
or
ICR
Katie
Turner
General Information
(646) 277-1228