SunOpta acquisition expands firm's strawberry supply

By Lorraine Heller

- Last updated on GMT

Related tags Sunopta Mexico California

Natural food group SunOpta is to increase its supply of
strawberries to the food industry, following the acquisition of
certain assets from a South American frozen strawberry processor.

Completed last week, the acquisition of assets of Mexico's Baja California Congelados (BCC) is expected to add more than 20 million pounds of strawberries to SunOpta's supply chain by next year.

The additional capacity, which is in response to increased customer demand, will result in a $14m annual revenue increase, said the company.

"The incremental capacity and raw material supply is critical to meeting the growth in demand in the natural and organic fruit market.

This transaction is highly synergistic with our existing berry operations and will significantly improve our ability to serve fast growing markets," said Sergio Varela, president of the SunOpta Fruit Group.

Under the terms of the agreement, SunOpta purchased all of the physical assets of BCC's production facility located in Rosarito, Baja California, Mexico.

It also assumed a long-term lease for the facility, which is 20 miles south of San Diego, California.

SunOpta also entered into five year supply agreements with Andrew Williamson, the San-Diego-based former parent of BCC.

The agreements provide for the supply of strawberries from both the Baja California and Oxnard, California growing regions to the Rosarito facility in addition to SunOpta's existing California facilities.

Andrew Williamson has agreed to provide operational and customer service support to assist SunOpta in transitioning the facility under SunOpta management, said the firm.

According to Steve Bromley, president and chief executive officer of SunOpta, the latest transaction is consistent with its strategic plan to expand its global sourcing and production capabilities in order to meet customer demand and ensure reliable and quality supply of natural and organic fruit products.

Last year, SunOpta announced plans to quadruple its sales of another fruit experiencing increased demand - the açai berry.

The firm said the Brazilian berry is the most popular fruit ingredient with its customers in North America.

The company said it expected to increase its açai business to around $4m over 2007, as demand soars for the ingredient on the back of its unique health benefits.

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