Local Bounti to acquire Pete’s for $122.5M
Controlled environment agriculture, or CEA, continues to gain traction in the produce world. The acquisition of one CEA company by another will generate synergies between two companies committed to the growing technique.
Hamilton, Mont.-based Local Bounti Corporation, a U.S. indoor agriculture company, announced that it will acquire indoor farming company Carpinteria, Calif.-based Hollandia Produce Group Inc., which operates under the name Pete's, for $122.5 million, according to a press release.
Pete's has distribution to approximately 10,000 retail locations. The transaction allows Local Bounti to gain access to Pete's existing retail customer base. Pete's primary products include living butter lettuce, with about 80% share of the market in the western U.S., as well as packaged salad and cress. Pete's has been in operation for over 50 years while focusing the last 25 years in leafy greens, the release said.
"This synergistic acquisition is a unique opportunity to combine a highly complementary market leader in Pete's with Local Bounti's technological solutions to significantly accelerate market access for our produce varieties and create one of the largest CEA companies in the U.S.," Craig Hurlbert, co-CEO of Local Bounti, said in the release. “We are thrilled to leverage our combined strengths through this transaction. It provides instant scale that creates immense value for our employees, customers, partners and shareholders alike, and we couldn't be more excited about what lies ahead."
Local Bounti plans to install its patent pending Stack & Flow Technology at Pete's three facilities, combining aspects of vertical farming and greenhouse-growing technologies to deliver higher yields of diverse leafy greens.
"For 50 years, we have been obsessed with offering high-quality products and great service while focusing on innovation and sustainability within the indoor farming space,” Brian Cook, CEO of Pete's, said in the release. “By combining with Local Bounti, we scale our business and partner with a leader that shares our philosophy."
Pete's is a California-based indoor farming company with three greenhouse-growing facilities, including two operating facilities in California and one under construction in Georgia. The latter is scheduled to begin operations in the second quarter of 2022, according to the release.
