Apr 5, 2022Local Bounti closes acquisition of Pete’s
Local Bounti Corp., a U.S. indoor agriculture company combining vertical and greenhouse growing technologies, announced April 5 the successful completion of its acquisition of California-based complementary indoor farming company Hollandia Produce Group, Inc., which operates under the name Pete’s, effective April 4.
“The combination of Pete’s operational scale and retail distribution footprint with our market-leading unit-level economics creates immediate value for our employees, customers, partners, and shareholders,” Craig Hurlbert, co-CEO of Local Bounti, said in a news release. “This acquisition is immediately accretive and opens the door for further margin expansion as we implement our proprietary Stack & Flow Technology into Pete’s facilities and unlock additional operational synergies.
“Combined, this platform is well-positioned to take on the rapidly expanding controlled environment agriculture produce market, which is expected to reach $30 billion in the U.S. by 2025, and generate accelerated returns on invested capital. We welcome all of Pete’s 130 employees to the Local Bounti family and look forward to a seamless integration process.”
Magda Overgaag, co-founder, matriarch of Hollandia Produce Group, Inc. and mother of Pete, stated, “The closing of the transaction with Local Bounti marks yet another important milestone for my family and our long history within the CEA industry that began over 100 years ago when my father and my husband’s father began growing under glass in the Netherlands. We immigrated our family to California in 1968 and have been driving innovation in growing techniques across a variety of crops ever since. Today, Pete’s represents a trusted brand that delivers the highest quality living lettuce varieties in the industry. We couldn’t be more excited with this transaction, which ensures that our family’s legacy will live on and be a formidable force in the CEA industry for generations to come.”
Local Bounti funded the purchase price of $122.5 million, with a combination of $92.5 million in cash provided pursuant to Local Bounti’s lending facility with Cargill, and $30.0 million of consideration payable in shares of Local Bounti common stock.
In conjunction with the closing, Local Bounti also announced the appointment of Brian Cook to the position of president at Local Bounti, who will report to co-CEOs Craig Hurlbert and Travis Joyner. Cook previously served as president of Pete’s from November 2017 until its acquisition by Local Bounti.
Local Bounti is a premier controlled environment agriculture (CEA) company redefining conversion efficiency and environmental, social and governance (ESG) standards for indoor agriculture. Local Bounti operates an advanced indoor growing facility in Hamilton, Montana, within a few hours’ drive of its retail and food service partners. Reaching retail shelves in record time post-harvest, Local Bounti produce is superior in taste and quality compared to traditional field-grown greens.
Local Bounti’s USDA Harmonized Good Agricultural Practices (GAP Plus+) and non-genetically modified organisms (GMO) produce is sustainably grown using proprietary technology 365 days a year, free of pesticides and herbicides, and using 90% less land and 90% less water than conventional outdoor farming methods.
With a mission to ‘bring our farm to your kitchen in the fewest food miles possible,’ Local Bounti is disrupting the cultivation and delivery of produce. Local Bounti is also committed to making meaningful connections and giving back to each of the communities it serves.