The manufacturer is offloading its facilities in Fridley, Minnesota, and Lodi, California, which produce breads, rolls and cakes for instore retail bakeries and foodservice customers.
The deal comes hot on the heels of the announcement that TreeHouse is terminating the sale of its RTE private label cereal business to Post Holdings for $110m, citing difficulty from the FTC filing.
“After thoroughly evaluating our options and the potential outcomes, our board has determined that terminating the agreement with Post and immediately seeking another buyer for the business is the proper course forward,” said TreeHouse CEO Steve Oakland.
“Unfortunately, the business risk, necessary resources and extent of time required to challenge the FTC's position was not in the best interest of our constituencies.”
Coping with customer demand
Buffalo, New York-based Rich Products is a family-owned company that specialises in cakes, speciality toppings, pizza and appetisers. The producer has a footprint in 100 locations globally, raking in annual sales that exceed $4bn.
“The facilities we are acquiring from TreeHouse enhance our current dessert and bakery product portfolios and align well with our long-term growth strategies,” said Ray Burke, president and CEO, Rich’s US, Canada region.
“These added capabilities will also allow us to provide greater fully-finished and artisan product options, which are in high demand among our customers.”
TreeHouse is retaining its popular frosted sugar cookies and Lofthouse branded business.
“The sale of the Fridley and Lodi facilities allows us to sharpen our focus at TreeHouse and importantly, creates an opportunity for these plants to thrive under Rich Products’ ownership,” said Steve Oakland, CEO and president of TreeHouse Foods.
The approximately 400 employees at the two plants will transition to Rich Products.
The transaction is subject to customary closing conditions and is expected to close by April 10, 2020. Financial terms were not disclosed.