Utz to acquire Festida Foods for $41M

Hanover-based Utz Quality Foods, Inc. announced Tuesday it has entered into an agreement with Great Lakes Festida Holdings, Inc., to acquire Festida Foods for $41 million.

Festida Foods is a leading manufacturer of tortilla chips, corn chips, and pellet snacks and is the largest manufacturer of tortilla chips for Utz’s ON THE BORDER tortilla chip brand.

“We expect that this strategic acquisition will enable strong supply chain synergies for our ON THE BORDER® brand and enhance our ability to expand both ON THE BORDER® and other Utz Power Brands geographically in the Midwest,” Utz CEO Dylan Lissette said. “Over time, we intend to expand production capabilities in the manufacturing plant to support growth in adjacent sub-categories and better serve current and future retail customers in an important area of geographic growth for the Company. We believe this strategic combination will help accelerate growth and expand margins over the long term, and we look forward to continuing to serve Festida Foods’ existing customers.”

Utz said it expected the transaction to be accretive of earnings this year and in coming years. The transaction is subject to customary closing conditions and is expected to close in the second quarter of 2021.

“The Festida Foods team is thrilled to be joining the Utz family,” Festida Foods CEO Kyle Curtiss said. “As a premier supplier of tortilla chips to Truco Enterprises and ON THE BORDER, one of the fastest-growing tortilla chip brands in the United States, Utz will be in a position to leverage Festida’s manufacturing expertise, capacity, and warehousing to support its brands in the Midwest. Additionally, and of utmost importance to our business, Utz shares a belief in a strong company culture that both supports and encourages member development. They are truly an ideal long-term partner for Festida Foods!“

Under the terms of the agreement, the assets and certain operating liabilities of Festida, and the real estate owned by a related entity would be acquired by subsidiaries of Utz. Utz expects to fund the acquisition in cash using its revolving credit facility.