Total Produce buys majority stake in U.S. produce group
California-based Progressive Produce joins the likes of Oppy, Eco Farms and Gambles Group as Irish multinational Total Produce continues its run of acquisitions in the North American market.
In an announcement today, Total Produce said it had acquired a 65% equity stake in Progressive Produce LLC, a Los Angeles-based company that recorded sales of US$200 million last year, with US$36 million in assets and 214 employees.
From four distribution facilities in California and Washington, Progressive Produce provides a wide range of fresh, domestic, local and imported produce and specializes in the year-round supply of potatoes, onions, asparagus, organics and other fresh fruits and vegetables.
Total Produce said a further payment would be made in 2019, contingent on achieving future profit targets.
The company said long-term put and call options were place for the remaining 35% share, and it expected the recent investment to be 'earnings enhancing' from the date of closing.
An initial payment for the purchase consideration is expected today on closing.
Jim Leimkuhler (president), Victor Rodarte (vice president) and Jack Gyben (vice president) will remain as equity holders of the business and will continue to be key members of the executive management team.
"We are delighted to become co-owners in Progressive Produce. This transaction with a leading California produce company further broadens our US operations and is in line with our strategy," said Total Produce chairman Carl McCann.
"We look forward to working with the excellent people in Progressive Produce as it continues to develop its very successful business expansion in future years.
Progressive Produce president Jim Leimkuhler said the transaction would further strengthen the business his group had developed and grown over many years.
"We believe this is an excellent long-term combination of skills and expertise that will benefit all stakeholders, including our growers, our suppliers, our people and our customers," Leimkuhler said.