Press release from PR Newswire
United Natural Foods Signs Definitive Agreement To Acquire the Canadian Food Distribution Assets of the SunOpta Distribution Group
Tuesday, May 11, 2010
UNFI Will Become Canada's Largest Distributor of Organic, Natural and Specialty Foods
PROVIDENCE, R.I., May 11 /PRNewswire-FirstCall/ -- United Natural Foods, Inc. (Nasdaq: UNFI) today announced that it has entered into a definitive agreement to acquire the Canadian food distribution assets of the SunOpta Distribution Group business ("SDG") of SunOpta Inc. (Nasdaq: STKL, TSX: SOY), for total consideration of approximately CDN $68 million in cash. The transaction is subject to customary closing conditions and is expected to close by early June 2010. Upon closing, the SDG business will be operated through a wholly-owned subsidiary of UNFI, and will operate in Canada as UNFI Canada, Inc.
This acquisition is strategic for UNFI.
As Canada's largest distributor of organic, natural, kosher and specialty foods, the pending acquisition of the SDG business will provide UNFI with an immediate platform for growth in the Canadian market.
Founded in 2002, SDG serves approximately 6,000 customer locations, 15,000 SKU's and 5 distribution centers utilizing leading edge technology. SDG has enjoyed solid market demand over the last several years and achieved 2009 revenues in excess of CDN $175 million.
SDG will continue to be headquartered in Toronto, Ontario.
"This acquisition is the latest step in our strategy to grow our Specialty Foods and Organic business," commented Steve Spinner, UNFI's President and Chief Executive Officer. "We are excited about entering the dynamic Canadian market and feel terrific about welcoming SDG to our organization. Both companies have a rich history of commitment to sustainability, integrity and philanthropy."
"We are very excited to be joining with UNFI given its broad product array and outstanding commitment to customer support," said Roger Eacock, President of SDG. "This transaction offers us additional resources to expand our product offerings and serve more customers with greater efficiencies, utilizing items such as UNFI's substantial purchasing power and sophisticated inter-regional logistics system."
Steve Bromley, President and Chief Executive Officer of SunOpta, commented, "In 2002, we started to build our natural, organic and specialty food and natural health products distribution business in Canada. We are very proud of the attractive platform that has been put in place. Divesting the food distribution assets is an important milestone in our strategy to focus on our core food manufacturing platform, strengthening our balance sheet and positioning SunOpta for the future. We have long admired UNFI's strong values and commitment to the natural, organic and specialty foods industry, and believe they will bring great value to the Canadian marketplace. We want to express our sincere appreciation to our dedicated employees for their years of hard work and dedication and wish them continued success under UNFI's leadership."
The Company will be holding a conference call and audio webcast to discuss the acquisition at 11:00 am ET today. The conference call dial-in number is (480) 629-9869. The audio webcast of the conference call will be available to the public, on a listen-only basis, via the Internet at www.fulldisclosure.com or at the Investors section of the Company's website at www.unfi.com. The online archive of the webcast will be available on the Company's website for 30 days.
About United Natural Foods
United Natural Foods, Inc. (http://www.unfi.com) carries and distributes more than 60,000 products to more than 17,000 customer locations nationwide. 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 in 2005 as one of the "Best Managed Companies in America," ranked by Fortune in 2006 ? 2010 as one of its "Most Admired Companies," winner of the Supermarket News 2008 Sustainability Excellence Award, and recognized by the Nutrition Business Journal for its 2009 Environment and Sustainability Award.
About SunOpta Inc.
SunOpta Inc. is an operator of high-growth ethical businesses, focusing on integrated business models in the natural and organic foods and natural health products markets. The Company has three business units: SunOpta Foods, which specializes in sourcing, processing and distribution of natural and organic food products integrated from seed through packaged products; Opta Minerals Inc. (TSX: OPM) (66.4% owned by SunOpta), a producer, distributor, and recycler of environmentally friendly industrial minerals; and SunOpta BioProcess Inc. which engineers and markets proprietary steam explosion technology systems for the bio-fuel, pulp and food processing industries. Each of these business units has proprietary products and services that give it a solid competitive advantage in its sector.
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 on September 30, 2009 and its quarterly reports on Form 10-Q filed thereafter, and include, but are not limited to, the ability of the Company to consummate the proposed acquisition of the SDG business, the Company's ability to successfully deploy its operational initiatives in the Canadian market, 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 the SDG business; 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; increased fuel costs; the Company's sensitivity to inflationary pressures; the relatively low margins and economic sensitivity of the Company's business; the ability to identify and successfully complete acquisitions of other natural, organic and specialty food and related product 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.
SOURCE United Natural Foods, Inc.
For further information: AT THE COMPANY: Mark Shamber, Chief Financial Officer, +1-401-528-8634; or FINANCIAL RELATIONS BOARD, Joseph Calabrese, General Information, +1-212-827-3772