Cal-Maine Foods has struck a deal to acquire assets from fellow US eggs supplier Fassio Egg Farms.
The transaction involves “substantially all the assets of Fassio Egg Farms, Inc., related to its commercial shell egg production and processing business”, publicly-listed Cal-Maine said in a stock-exchange filing.
Cal-Maine is set to buy commercial shell egg production and processing facilities with a capacity of approximately 1.2m laying hens, reared “primarily” cage-free. The assets also include a feed mill, fertiliser production and land located in Erda, outside Salt Lake City in Utah.
The deal is the first publicly-announced acquisition Cal-Maine has made since appointing Sherman Miller, a two-decade veteran of the business, president and CEO in September last year.
“We are excited about the opportunity to expand our market presence in Utah and the western United States with the proposed acquisition of these assets from Fassio,” Miller said. “The additional production capacity, especially for cage-free eggs, will enhance our ability to serve our valued customers in this important market area.”
Terms were not disclosed. Cal-Maine said it expects to close the transaction “in the next few weeks”.
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By GlobalData
Cal-Maine says it is the largest producer of fresh shell eggs in the US. In July, the company booked a 77% leap in its annual net sales to $3.14bn for the year to 3 June. It was a 12 months in which egg sales prices jumped amid an outbreak of highly pathogenic avian influenza in the US.
Annual operating income stood at $967.7m, versus $143.5m a year earlier. Net income attributable to Cal-Maine was $758m, compared to $132.7m the year previous.
The company is scheduled to report the results for the first quarter of its current financial year on 3 October.
