Lamb Weston to take full ownership of European JV with Meijer Frozen Foods
American potato processing company Lamb Weston has agreed to take full ownership of Lamb-Weston/Meijer, by buying out the remaining 50% stake in the European joint venture (JV) from Meijer Frozen Foods in a cash and stock deal worth €700 million.
Lamb-Weston/Meijer is a supplier of frozen potato products in Europe, the Middle East, and Africa. In fiscal 2022, the frozen potato products supplier had net sales of nearly €954 million.
Kees Meijer — Meijer Frozen Foods CEO said: “We’re proud of the business we’ve built together to create a market leader in Europe.
“We remain confident in the long-term outlook for Lamb Weston and the global frozen potato category. By holding an investment in common stock of Lamb Weston after the transaction closes, we sustain our strong belief in a bright future for the business.”
Lamb Weston to take full ownership of European joint venture with Meijer Frozen Foods. Photo courtesy of Lamb Weston Holdings, Inc.
The Lamb-Weston/Meijer joint venture was formed by Lamb Weston and Meijer Frozen Foods in 1994.
According to Lamb Weston, the full ownership of the joint venture gives it ownership of an additional five frozen food manufacturing plants, of which four are in the Netherlands and one in the UK. Besides, the American potato processing company gets a 75% stake in another frozen food manufacturing plant located in Austria.
The six facilities combined produce around two billion pounds of finished frozen products per year. Additionally, upon completion of the deal, nearly 1,500 employees of Lamb-Weston/Meijer will join Lamb Weston.
Tom Werner — Lamb Weston President and CEO said: “Lamb-Weston/Meijer was built over the last 28 years, and we’re grateful to Meijer Frozen Foods for their longstanding partnership.
“The joint venture has served as a strong platform to drive growth in Europe and the Middle East, as well as to support our global customer base across our key international markets.
This transaction firmly aligns with Lamb Weston’s long-term capital allocation and acquisition framework, and we believe it will strengthen our manufacturing footprint by leveraging a truly global supply chain to better serve our customers and position us to take advantage of growth opportunities in Europe, the Middle East and Africa.”
The consideration is made up of €525 million in cash and €175 million worth Lamb Weston shares.
The deal, which is subject to regulatory approvals, is expected to close in the second half of fiscal 2023.