Hormel Foods has announced the acquisition of Columbus Manufacturing, Inc., an authentic, premium deli meat and salami company, from Chicago-based Arbor Investments for approximately US$850 million. This strategic acquisition positions Hormel Foods as a total deli solutions provider and enhances its other strong deli brands such as Hormel, Jennie-O, Applegate and Di Lusso.

“We are pleased to add Columbus to the Hormel Foods family. Columbus has an outstanding reputation in the food industry and is well-positioned in the advantaged retail deli category,” says Jim Snee, president and chief executive officer at Hormel Foods. “Columbus is capitalizing on one of the fastest-growing areas in the retail grocery store with premium, authentic products that are on-trend with today’s consumers who are looking for unique experiences, flavors, and products.”

“The acquisition of Columbus will serve as a catalyst for uniting all our deli businesses into one customer-facing organization,” Snee notes. “This acquisition significantly enhances our scale in the deli by broadening our portfolio of products, customers, and consumers. The synergies we can unlock with this acquisition are clear and I’m excited for the next evolution of our company.”

“As a millennial-focused brand, Columbus has generated category-leading growth through a passionate commitment to quality, simplicity, and time-honored recipes,” explains Joe Ennen, chief executive officer of Columbus Manufacturing, Inc. “In Hormel, we are joining an organization whose values and culture perfectly align with our own.”

Total annual sales are approximately US$300 million with an expected growth rate in excess of 5 percent. Hormel Foods expects this acquisition to be modestly accretive to earnings per share in fiscal 2018. Full-year accretion in fiscal 2019 is expected to be between 6 to 8 cents per share.

The company will continue to operate from California and will report into the Refrigerated Foods segment. The transaction is subject to customary closing conditions, including the receipt of regulatory approvals in the US.