Flowers Foods completes acquisition of Lepage Bakeries

US bakery foods producer Flowers Foods has completed the acquisition of Lepage Bakeries, an independent baking company based in Maine, US, in a $370m cash-and-stock deal.

Flowers Foods had entered into a definitive agreement to acquire Lepage Bakeries in May 2012.

Lepage Bakeries offers breads, rolls and donuts to consumers across north-eastern US under the Country Kitchen and Barowsky’s brands.

The company, which posted net sales of $166m in fiscal 2011, owns three bakeries in New England – two in Lewiston, Maine, and one in Brattleboro, Vermont.

According to Flowers Foods, the acquisition complements its product range with the addition of regional brands such as Country Kitchen and Barowsky’s and several varieties of breads, buns and rolls, while strengthening its presence in New England and New York.

The deal also increases Flowers Foods’ direct-store-delivery (DSD) platform, and expands the geographic footprint of its Nature’s Own and Tastykake brands in north-eastern US.

Flowers Foods chairman and CEO George E Deese noted that the acquisition will increase the company’s DSD access from 64% to 70% of the US population, bringing the company closer to its goal of achieving 75% access by 2016.

The company expects the transaction to add $0.03 to $0.05 to its earnings per share in fiscal 2012, excluding acquisition costs, and $0.08 to $0.12 to earnings per share in fiscal 2013.

With the completion of the acquisition, Flowers Foods will own a total of 44 bakeries, while Lepage Bakeries will operate under its current name and as part of Flowers Foods’ DSD segment.

The current Lepage leaders, Andrew Barowsky and Albert Lepage, will serve as co-chairmen of the board of Lepage Bakeries, and Barowsky will also serve as vice chairman of innovation for Flowers Foods.