Greencore buys US firm for $36m

The $36m (€27.3m) acquisition of Marketfare Foods by Greencore will increase the Irish plc’s US operations by 70%.

The acquisition of Marketfare will take Greencore’s US turnover from $95m to $160m.

Greencore had been in talks to buy Marketfare since December. Greencore chief executive Patrick Coveney said the acquisition was a significant step in Greencore’s plans to expand in the US.

“The Marketfare acquisition is very consistent with our strategy in the States. We are looking to get our sandwich products in to small stores,” Mr Coveney said.

Marketfare is a leading manufacturer of takeaway food products for convenience and small shops in the US. Its main customer is 7-Eleven, which it has partnered for more than 20 years. It is the largest single supplier of Fresh to Go and store-branded sandwiches, servicing 1,100 7-Eleven shops in the north-east.

“The acquisition of Marketfare represents an excellent opportunity for us to further develop our food to go business in the US, building on the successful acquisition of On a Roll in Dec 2010,” said Mr Coveney. “It builds additional scale with 7-Eleven, provides new competencies for us in the fast-growing food-to-go category and extends our geographic footprint principally along the eastern seaboard.

“The new product capability and geographic expansion provide the opportunity to expand further with our existing customers; the acquisition represents the next step in our strategy to build a business of real scale in the US.”

The purchase will not require an extraordinary general meeting for approval. Mr Coveney said the takeover should not be a surprise, as it is consistent with expansion plans. “We’ve has a good run this year in terms of stock price. I’d hope this won’t come as surprise to shareholders.”

The market responded positively to the news, with the stock price increasing by 1% to close at 74p on the FTSE.