AAK has acquired the leading West Coast based vegetable oils company California Oils Corporation from Mitsubishi Corporation of Japan. California Oils Corporation, also known as CalOils, had last year revenues of approximately SEK 1,350 million and a volume of approximately 110,000 MT, with 65 employees.
“A strong presence on the U.S. West Coast has been priority for AAK since several years. The West Coast encompasses 20 percent of the U.S. population and this expansion has been identified as an important component of AAK’s long-term growth strategy. The acquisition of CalOils will transform AAK into a true national speciality and semi-speciality edible oils company, improving our ability to serve existing customers on a national scale while at the same time creating new customer opportunities”, says Terrence W. Thomas, President AAK USA. “CalOils has important market positions up and down the West Coast. This acquisition establishes AAK as the leading supplier of speciality and semi-speciality oils to the bakery, dairy and chocolate and confectionery industries in California and across the west coast of the U.S. and Canada. In the medium term it also supports our U.S. foodservice platform, Oasis Foods, to develop into a national supplier.”
CalOils’ facility, which is AAK’s fourth production site in the U.S., is based in Richmond, California.
“This acquisition is an integral part of our company program AAKtion”, says Arne Frank, CEO, AAK Group. “Not only will it strengthen AAK’s presence in a very important market, we will also bring our customer co-development concept to a national level in the United States and Canada. The acquisition will serve as a platform for increased sales of speciality and semi-speciality products within Food Ingredients and Chocolate & Confectionery Fats.”
The acquisition price is subject to final calculation of normalized working capital and is expected to be less than 3 percent of AAK’s turnover on a cash and debt free basis. The acquisition cost is funded by existing credit facilities. The transaction is expected to be finalized between end of August to end of September 2016 and is expected to start contributing to AAK’s operating profit from the third quarter, 2017.