Popina Foods, a market leader in oat-based cereals and snacks, is poised to be bought by ASX-listed good-for-you food company Freedom Foods for $35 million.
Demand for oats rising in Australia and Asia, according to Freedom Foods, and Popina is a recognised leader in cluster format cereals and snacks in Australia.
The company operates out of a 10,500 sqm facility in Dandenong, Victoria. It makes a quarter of its sales from its own brands, Arnold's Farms and Goodness Superfoods, and the rest from its contract manufacturing operations.
The company was founded by Arnold May in 1983. Operating out of a shop front in inner Melbourne, he initially toasted muesli in small oven, blended it in a cement mixer and sold it to a few health stores.
Thirty two years later, and Popina now holds more than a third of the Australian muesli market.
To fund the acquisition, Freedom Foods has sold down its stake in listed milk company, and its former takeover target, a2 Milk to 10.4 per cent, from 19 per cent.
Freedom is also conducting a $65m capital raising to fund the acquisition and future growth plans.
Freedom reportedly intends to maintain a strategic stake in a2 Milk.
