NEW YORK (AP) — Flowers Foods continued its aggressive pursuit of consumers seeking options they see as healthier, buying its second organic bakery in less than a month.
Major food producers, from Kellogg to General Mills, are maneuvering away from dinner table staples that are now perceived by some as too processed, and are in the hunt smaller players that can get them there faster.
Flowers, with sales last year of $3.75 billion, has spent almost $400 million in the past month on organic bakers.
Flowers on Wednesday said that it would pay $120 million for Alpine Valley Bread Co., whose products include Super Grains, 21 Whole Grains, Multi Grain Omega -3, Sprouted Wheat with Flaxseed. In mid-August, Flowers spent $275 million to snap up Dave's Killer Bread, another organic baker.
"Alpine Valley Bread Company will further strengthen our company," Flowers CEO Allen Shiver said in a printed statement.
Alpine Valley operates two bakeries in Mesa and anticipates sales of about $85 million to $95 million in fiscal 2016.
And the company said it's generated a compound average revenue growth rate of about 51 percent over the past three years.
Flowers, citing data from retail analyst IRI, says the organic bread market has grown at a rate of 27 percent over the past four years, which outpaces the broader $23 billion U.S. retail baked goods market.
Flowers Foods Inc., based in Thomasville, Georgia, said it will fund 90 percent of the buyout with credit and cash-on-hand, while 10 percent will involve stock. The deal is expected to close in the fourth quarter.