Singapore-based food and agri-business Olam International Ltd. agreed to acquire California-based almond producer Hughson Nut Inc. for a total enterprise value of $54 million.
The transaction will be funded by a combination of internal accruals and existing debt facilities, Olam said.
Hughson Nut processes almonds and manufactures ingredients such as sliced and diced almonds and almond flour.
Olam said the acquisition is in line with its strategic plant to offer differentiated solutions such as ingredients and product innovation, as well as target new customer segments in co-manufacturing, foodservice and e-commerce.
"Combining HNI's processing capabilities with Olam's global network and Edible Nuts expertise will enhance our offering to customers and enable us to meet growing demand, in and outside the U.S.," Olam's Managing Director and CEO of Edible Nuts Ashok Krishen said in a statement.
Hughson Nut's senior executive team and 400 employees will continue to manage the existing operations and expand its ingredient business after the acquisition, Olam said. Hughson Nut's grower-family vendors will also continue to supply it with almonds for processing.
Olam expects the acquisition to be earnings and returns accretive from the first year after the merger. The transaction is expected to close in November, subject to customary closing conditions.