Five Star Custom Foods produces cooked meat, soups and sauces for both restaurants and food producers. The ink is not dry on the deal, signed by both parties on Wednesday 1 June, and Cargill has not disclosed terms of the takeover.
Both parties expect the acquisition to be completed this summer, following regulatory approval.
News of the billion-dollar business’ acquisition of Five Star Custom Foods comes a week after it announced a $5.9m investment in a joint-venture with Philippine fast-food giant JFC, leading to 1,000 new jobs. It comes as the company attempts to restructure some of its revenue streams after Q3 revenue fell by 11%.
History of success
Cargill will take control of Five Star Custom Foods facilities in Fort Worth, Texas, and Nashville, Tennessee. The 151-year-old business said the takeover would reinforce its cooked protein portfolio, while simultaneously optimising its supply chain and enhancing innovation opportunities.
“We’re thrilled with the opportunity to add Five Star Custom Foods to the Cargill family, because it has a record of proven success, producing high-quality, value-added, customised products that delight its customers,” said Cargill’s corporate vice-president of protein businesses Brian Sikes.
“Adding Five Star Custom Foods to Cargill’s protein business will provide us with new capabilities we currently do not have, while allowing us to be more nimble in our ability to meet the ever-changing needs of our customers and consumers in today’s fast-paced marketplace,” explained Sikes.
Jeff Bledsoe, president and founder partner of Five Star Customer Foods, hailed the “winning scenario” the acquisition offers both businesses and said he was excited by Cargill’s “long-term profitable growth”.
Bledsoe started the company 17 years ago and the privately-listed food business now employs 385 people.
Cargill’s president of Meat Solutions Corporation, John Keating, said the two new locations “fit well” with the company’s US geographic footprint as it already operates a beef-grinding factory in the Fort Worth area.