The sale is scheduled to close by the end of July and will mean that Paramount’s lemon program will represent 20% of total domestic sales of California lemons, Paramount president David Krause said July 22.
The move will add almost 7,000 acres total of navel and Valencia oranges and lemons to Delano, Calif.-based Paramount’s operation. Krause said all of the acres are mature and producing fruit. The breakdown by commodity is 3,100 acres of navels, 2,900 acres of lemons and 1,000 acres of Valencias.
With the additional acres, Paramount’s navel packed acres will increase by 45% and its California lemon fresh carton volume by 43%, Krause said.
“This adds 2.4 million packages (40-pound equivalents) to our annual citrus operation,” Krause said.
Jeff Huckaby, executive vice president for Grimmway Farms, described the sale in a news release as an opportunity for the carrot company to transition away from citrus while “ensuring a solid future for the farmers in our outside grower program.”
“This allows us to focus even more of our efforts into our core business, the consistently growing carrot and organic vegetable market,” Huckaby said in the release.
The two companies have been in negotiations for “less than six months,” Krause said. He said the timing was perfect, and not just because the deal will be closing during the lull of the California citrus season.
“It was a combination of our decision to broaden our citrus packing operation and Grimmway’s desire to focus on their core business,” Krause said.
The Grimmway citrus growers who now supply Paramount operation have acreage in the San Joaquin Valley, Ventura County and the California desert. About 100 growers are involved.
“We’re already talking to those growers and plan to have the transition complete by the end of the month,” Krause said.
The three-member grower representative staff at Grimmway is moving to Paramount’s operation, Krause said, to provide continuity for the growers involved. Krause said Paramount will likely add sales and support staff to handle the increased volume the acquisition means for the company.
Paramount has been in grower-recruitment since it ended its relationship with Sun Pacific earlier this year.
Grimmway bought its citrus division from Belridge Farms in 1991, according to a news release. The division includes a building and equipment north of Bakersfield. Krause said Paramount is buying all of the equipment.
Grimmway president Jeff Meger said in a news release that all hourly workers in the company’s citrus division will be offered jobs in Grimmway’s other divisions.
“We have experienced dramatic increases in the carrot category, and it has become necessary for us to expand our carrot operations into this space,” Meger said in the release.