Utz is betting on tortilla chips in a big way.
Utz Brands Inc., a Hanover, Pa.-based manufacturer of salty snacks and other munchies, announced Thursday that it would pay $480 million for Truco Enterprises, which makes taco chips and salsa sold under the On the Border brand.
The deal adds to a big year for Utz Brands.
Utz became a publicly traded company in late August through a merger with a special purpose acquisition company. The deal married Collier Creek Holdings to Utz Brands Holdings. The resulting entity was valued at about $1.5 billion.
The combination gave Utz’s controlling Rice family the opportunity to cash out $60 million of their ownership stake while maintaining control of the potato chip and pretzel maker founded by Bill and Salie Utz in 1921.
In addition to Utz chips and snacks, the company owns the Dirty, Bachman, and Zapp’s chips and snacks brands.
The acquisition of Truco, based in Carrollton, Texas, is only the latest of Utz’s efforts to expand its market. On Nov. 2, Utz completed a $10 million deal to buy assets of H.K. Anderson, a maker of peanut butter-filled pretzels, from Conagra Brands. The transaction gives Utz a jump-start in the rapidly growing filled-pretzel segment.
If the deal is completed next month as scheduled, it will make Utz the third-largest salty-snack company in the United States, with $1.3 billion in annual revenue, just behind Campbell Soup Co.'s $1.36 billion in salty-snack sales, according to an Utz investor presentation. The top spot is held by Pepsi, which owns Frito-Lay.
On Nov. 5, Utz reported “strong financial results" for its first quarter as a public company, according to CEO Dylan Lissette. Utz, he said, saw net sales of $248.0 million, an increase of 24.2% over the prior-year period.
Utz Brands shares closed Friday at $18.61, up 2.25%.