Utz Brands Sells Snack Brands and Manufacturing Facilities to Our Home
Utz Brands is streamlining its portfolio and supply chain capabilities, selling off two subsidiaries and manufacturing facilities in a deal valued at around $182.5 million.
The salty snack company will sell RW Garcia and Good Health brands and three manufacturing facilities in Lincolnton, NC; Lititz, Pa.; and Las Vegas to fellow snack maker, Our Home – home to brands like Food Should Taste Good, Popchips, Real Food From the Ground Up and You Need This.
Under the terms of the deal, reciprocal co-manufacturing agreements will be established with Our Home co-manufacturing certain Utz products and vice versa. Some Good Health products will also continue to be distributed and sold on the Utz Direct Store Delivery network.
The company said that Utz workers in the sold facilities will be offered employment opportunities as part of the transition.
Utz's Supply Chain Strategy for Growth
The brand, which went public in 2020, has made sizable investments in stabilizing its supply chain and manufacturing capabilities. In a 2022, Ajay Kataria, executive VP and CFO, noted that the company’s supply chain was improving thanks to bolstered manufacturing, logistics, and planning capabilities, increasing throughput and efficiencies.
This strategy seems to have picked up pace in recent months: on Utz’s Q3 2023 earnings call in November, a key tenet of the presentation focused on “aggressive actions” to optimize supply chain and product portfolio.
Around the same time, Utz made two new key supply chain leadership appointments, bringing in former Kraft Heinz exec, Mitchell Arends, as its EVP, chief integrated supply chain officer, and tapping Cary Devore, as its EVP, chief operating and transformation officer.
Utz CEO Howard Friedman spoke to these broader supply chain plans, saying the transactions would hopefully “fast-track [the] deleveraging timeline by a full year” and “accelerate our brand portfolio strategy to better optimize for growth,” as well as “free cash flow from lower interest expense” allowing the company to execute on its expansion plans nationwide.
