As part of its ongoing business strategy to grow the company’s international presence, ConAgra Foods Inc. (NYSE:CAG) announced that it has acquired TaiMei Potato Industry Ltd., a potato processor in Shangdu, Inner Mongolia. This acquisition expands ConAgra Foods’ Lamb Weston® operations in a market that has growing demand for frozen potato products. Lamb Weston makes a variety of frozen potato, sweet potato and other vegetable products for restaurants, retailers and foodservice operators in more than 100 countries around the world. The purchase price of $93 million will not impact the company's previously discussed debt reduction plans in fiscal 2015 and will further its growth internationally.
“We’ve been doing business in China and throughout Asia for more than 25 years, leading the way in market development and expansion,” said Greg Schlafer, president of Lamb Weston. “TaiMei is ConAgra Foods’ first potato processing facility in China, and we are confident they’ll help to accelerate our strong growth in Asia.”
Established in 2010, TaiMei is located in one of the largest potato growing regions in China. The facility provides Lamb Weston the ability to make frozen potato products closer to its expanding customer base and meet the growing demand for frozen potato products in Asia. TaiMei’s approximately 340 employees joined ConAgra Foods Lamb Weston upon close of the transaction.
“Our focused expansion in China is truly customer-centric. We’re leveraging our deep industry experience to develop in-country supply capabilities for our major quick-service restaurant chains and other strategic customers,” said Gary Rodkin, chief executive officer of ConAgra Foods. “Our customers have aggressive growth plans in China, and by adding ConAgra Foods’ operations in China, we will be better able to support their plans.”
The acquisition is part of ConAgra Foods’ strategy to grow its international business, and it will not impact the company’s long-term capital allocation plans.