SunOpta Expanding in South America
The company stated that it has entered into strategic exclusive agreements with reputable local fruit industry leaders to develop supply opportunities in the organic and natural frozen fruit industry. The agreements increase SunOpta's supply of natural and organic strawberries, raspberries and blueberries, apple and pear purees and fruit and vegetable concentrates from an important supply region.
The company entered into a five year exclusive supply agreement with Baby's Best Infant Food Ingredients S.A., a producer of organic and natural purees and concentrates in Mendoza, Argentina. The agreement ensures SunOpta of a constant and growing source of critical commodities. Under the terms of the agreement, SunOpta will provide a line of credit to enable Baby's Best to acquire a 45,000 square foot production facility in Mendoza to ensure SunOpta's supply chain. In addition, SunOpta received a first right of refusal and an option to acquire all of the outstanding shares of Baby's Best and related companies based on a predetermined formula, exercisable in March 2009.
The company has also entered into a three year exclusive organic supply agreement with a leading processor of organic and natural frozen fruits in Chile. Under the terms of the agreement SunOpta will finance a capital expansion to further develop growth in critical organic supply over the next three years.
Steve Bromley, president and chief executive officer of SunOpta commented that "We have had an excellent relationship with these companies over the past number of years and are delighted to expand these relationships to ensure our customers of a high quality, reliable and growing source of key organic products. These transactions reflect our strategy of extending our international sourcing capabilities for products that are in short supply globally."
From the April 9, 2007, Prepared Foods e-Flash