Canadian fruit juice producer Lassonde Industries has signed onto a US$390 million deal to take over a major U.S. cranberry processor and juice maker.
Lassonde, based at Rougemont in Quebec’s Monteregie, said Friday it expects to close its deal in August for a 71 per cent stake in Clement Pappas and Co., billed as the second-largest maker of store-brand ready-to-drink fruit drinks in the U.S.
The remaining stakes in privately-held, New Jersey-based Clement Pappas will go to the Lassonde family (10 per cent) and Pappas family (19 per cent).
“This transaction combines two premier fruit juice and drink manufacturers to form a North American category leader,” Lassonde CEO Pierre-Paul Lassonde said in a release Friday.
“This acquisition provides a platform for continued growth in the U.S. market through Clement Pappas’ extensive coast-to-coast network,” Lassonde chief operating officer Jean Gattuso said in the same release.
“The two companies are very complementary and together will have a well diversified product offering.”
Clement Pappas, founded in 1942 at Carneys Point, near Wilmington, Del., runs production facilities at Baltimore, Seabrook, N.J., Mountain Home, N.C., Springdale, Ark. and Ontario, Calif.
It also bills itself as a “major” producer of cranberry juices, sauces and drinks, with a cranberry receiving station at Carver, Mass.
The company will still do business under the Clement Pappas name and keep its existing management team and headquarters at Carneys Point, once it becomes a subsidiary of Lassonde, the companies said.
Lassonde said it expects to gain “increased critical mass to support national customers throughout North America” as well as “combined logistics, distribution, purchasing and other economies of scale.
The Pappas business is also expected to provide “growth opportunities” and “extensive expertise in cranberry juice, drinks and sauces” for Lassonde, the companies said.
Apart from fruit and vegetable juices and drinks, Lassonde also has hands in specialty food processing such as fondue broth and sauces, soups, gravies, canned corn-on-the-cob, bruschetta toppings, tapenades, pestos and sauces for pasta and pizza.
Lassonde in recent years has expanded capacity through acquisitions such as Ontario’s Apple Valley Juice and McCain Foods’ packaged juice business.
CORRECTION, June 20: A previous version of this article incorrectly stated Lassonde Industries was based at Brossard, Que. We regret the error.