Branching Out

Universal Corp. will acquire FruitSmart, an independent specialty fruit and vegetable ingredient processor serving global markets.

“Since outlining our capital allocation strategy in May 2018, we have been identifying a pipeline of strategic opportunities in adjacent markets around our core strengths: leveraging our highly localized rural infrastructure to source and process high-value, noncommodity, semi-perishable varietals from a large, reliant grower base for customers who demand fully traceable and compliant inputs,” said George C. Freeman III, chairman, president and CEO of Universal Corp.

“Given the worldwide addressable market opportunity for fruit and vegetable sourcing and processing and the similar supplier dynamics and scale benefits to our existing business, this transaction represents a foundational step in building out a broader agri-products services platform and has the potential to be a new source of growth to drive future value creation for our shareholders,” he added.

Universal anticipates the acquisition to be accretive to earnings the first fiscal year following closing. The company believes businesses in adjacent industries could represent at least 10 percent to 20 percent of earnings in the next five years.