Pennsauken, New Jersey-based J&J Snack Foods Corp. has entered into an agreement to acquire Dippin’ Dots, the producer of flash-frozen beaded ice cream treats, for $222 million, subject to customary purchase price adjustments.
The transaction will be funded through a combination of cash and senior debt financing and is expected to be accretive to J&J’s annual operating results. The agreement is anticipated to close by the end of June, subject to customary closing conditions.
“Dippin’ Dots aligns perfectly with J&J’s portfolio strategy by adding an iconic, differentiated brand that uniquely complements our frozen novelty and frozen beverage businesses,” said Dan Fachner, J&J Snack Foods president and CEO.
“With this acquisition, we can further leverage our combined strength in entertainment and amusement locations, theaters, convenience and supermarkets to realize added scale, operational and go-to-market synergies and create new selling opportunities among an expanded customer base. We are confident this transaction further positions us for accelerated growth across our business.”
An ice cream industry pioneer, Dippin’ Dots uses a patented cryogenic freezing process to create “beaded” ice cream, yogurt, sherbet and flavored ice products for consumers. The company sells its products through national accounts, local accounts and a franchise network with over 140 franchisees.
“The Dippin’ Dots team is thrilled to be joining the J&J Snack Foods family,” said Scott Fischer, CEO of Dippin’ Dots. “As a leader in the snack industry with a number of iconic brands and a strong record of product innovation, we believe J&J Snacks Foods is well-positioned to leverage our unique offering in the market and improve and grow the business going forward.”
Dippin’ Dots is headquartered in Paducah, Kentucky, along with a main production facility, warehousing, distribution and administrative offices. The company also leases four additional frozen warehouses located in California, Canada, Australia and China.
Ken Plunk, J&J Snack Foods chief financial officer, added, “Dippin’ Dots presents an opportunity to acquire a company that aligns with our focus on accelerating growth while delivering incremental shareholder value. Financially, we are leveraging our strong balance sheet and healthy liquidity position to acquire a profitable and scalable business that complements our long-term growth strategy. We expect this transaction to be accretive to our earnings per diluted share in the range of $0.30 to $0.40 per share in the first 12 months after closing. This acquisition also provides significant tax benefits contributing to an even more attractive overall valuation.”
For more information, visit jjsnack.com.