United Natural Foods To Buy Tony's Fine Foods - Quick Facts

(RTTNews) - United Natural Foods Inc. (UNFI) announced Thursday that it agreed to acquire all of the stock of Tony's Fine Foods, a distributor of perishable food products including a wide array of specialty protein, cheese, deli, food service and bakery goods throughout the Western United States, as well as Alaska and Hawaii.

The total purchase price for the acquisition of the business and related real estate is expected to be about $195.3 million, subject to certain post-closing adjustments, and will consist of about $187.8 million in cash and about 112,000 shares of the Company's common stock. The shareholders of Tony's will utilize a portion of the proceeds to pay off all of Tony's' existing indebtedness as of the closing.

The Company expects to finance the cash portion of the purchase price with a combination of available cash and borrowings under its revolving credit facility, which it amended yesterday to, among other things, increase the aggregate amount of availability by $100 million. A portion of the borrowings under the revolving credit facility are expected to be refinanced into an about $150 million real-estate backed term loan facility that the Company anticipates it will enter into in the fourth quarter of fiscal 2014 or first quarter of fiscal 2015.

Consummation of the transaction is subject to the satisfaction of customary closing conditions, including compliance with the Hart-Scott-Rodino Antitrust Improvements Act of 1976 as amended, and the transaction is expected to close late in the fourth quarter of fiscal 2014.

Upon closing, Tony's will be operated as a wholly-owned subsidiary of the Company, and the transaction is expected to be accretive to the Company's earnings in its fiscal year 2015.

Founded in 1934 by the Ingoglia family, Tony's products are sold primarily to retail and specialty grocers, food service customers and other distribution companies. For its fiscal year ended September 30, 2013, Tony's generated approximately $714 million in net sales.