Sara Lee Acquires Butter-Krust for $80 million
Butter-Krust Baking, which was established in 1920 and expects 2005 sales to total more than $80 million, primarily produces white bread and buns and Italian bread.
18/01/06 Sara Lee Corporation has signed an agreement to acquire Butter-Krust Baking, a Sunbury, Pa.-based, privately held, fresh bakery business for approximately $72 million. The transaction is subject to regulatory approvals and other customary closing conditions.
Butter-Krust Baking, which was established in 1920 and expects 2005 sales to total more than $80 million, primarily produces white bread and buns and Italian bread at its two plants in Sunbury and Northumberland, Pa. The company markets its products under the Holsum, Butter-Krust Country, Roman Meal and Milano brands in most of Pennsylvania and parts of Maryland, Virginia, West Virginia, New York, New Jersey and Delaware. In addition to the Pennsylvania plants and the headquarters office in Sunbury, Pa., the acquisition also includes 12 distribution depots and approximately 180 direct-store delivery (DSD) routes.
“With the acquisition of Butter-Krust Baking, Sara Lee will expand its mid-Atlantic distribution coverage, complementing our recent entry into the Ohio Valley, to better serve our customers and to reach more than 20 million additional consumers. Butter-Krust has a terrific reputation with its employees, customers and consumers, and we look forward to bringing this fourth-generation family company into the Sara Lee family,” said Brenda C. Barnes, chairman and chief executive officer, Sara Lee Corporation. “We will leverage the strong relationships that Butter-Krust has developed throughout the region to further expand the Sara Lee fresh bakery brand, which in just three years has become the largest and fastest growing brand in the U.S. fresh bakery aisle.”
In the highly fragmented fresh bakery segment, Sara Lee’s bakery brands currently reach more than 70 percent of the U.S. population. During the past two years, the company has expanded its distribution of the widely recognized Sara Lee brand of fresh baked goods into contiguous major markets in Florida, Idaho, North Carolina, Ohio and Virginia using existing production capacity. With the acquisition of Butter-Krust, the company will increase its market coverage to nearly 80 percent of the country, with the potential to expand further into the mid-Atlantic and Northeast.
