Pennsylvania-based snack food company Utz Quality Foods Inc. agreed to acquire Alabama-based Golden Enterprises Inc. (NASDAQ: GLDC), maker of the Golden Flake brand, for $135.5 million. The offer price of $12.00 per share in cash represents a premium of 71 percent over Golden Enterprises’ 30-day average closing price of $7.00.

Utz is a privately held family-owned business founded in 1921 by William and Salie Utz. They began making potato chips out of their home in Hanover, Pa. in much the same way Frank Mosher, Mose Lischkoff and Helen Freidman began Golden Flake in 1923. The Bashinsky family began their snack food legacy when they purchased the business in 1946. During their tenure Golden Enterprises grew from a small local operation to the multi-state corporation it is today.

“After conducting a review of strategic alternatives by a Special Committee consisting of independent members of the company’s board of directors, we believe that this is an excellent transaction for our stockholders, our customers and our employees,” said Golden Enterprises chief executive Mark McCutcheon. “This merger will allow the Golden Flake brand to continue to grow in our core southeastern markets, while expanding the product selections for our consumers. Utz is a very community oriented company and we look forward to the future that Utz and Golden Flake will create together.”

“We are excited about the opportunity to partner with Golden Flake,” said Utz CEO Dylan Lissette. “The two companies are very similar both in mission and values, and each has a team of dedicated associates. Golden Flake’s product line, market coverage, and manufacturing facilities blend well with Utz’s desire to expand and grow our markets in the south.”

The Golden Flake product lines and production capabilities will complement the Utz product portfolio, which include Utz, Zapps, Dirty, Bachman, Wachusett, Snikiddy and Good Health. Golden Flake said it will operate as a separate subsidiary under the leadership of its current management team and continue to be an important part of Birmingham as “The South’s Original Potato Chip!”

The deal was approved by Bashinsky family trusts holding a majority of the voting shares of Golden Enterprises, pending a three-day period for more favorable unsolicited alternative bids, the company said. Subject to antitrust approval and satisfaction of other customary closing conditions, the transaction is expected to close in the fourth quarter of 2016.

North Point Advisors LLC acted as financial advisor to Golden Enterprises, and Sirote & Permutt PC acted as legal counsel. Sandler O’Neill acted as financial advisor to Utz and Cozen O’Connor acted as legal counsel.

Utz has six manufacturing facilities in Pennsylvania, with additional facilities in Colorado, Louisiana and Massachusetts. the company’s products are distributed nationally through grocery, mass-merchant, club stores, convenience stores, drug stores and other channels.

Golden Flake Snack Foods Inc., is a wholly owned subsidiary of Golden Enterprises Inc. (GLDC), founded and is headquartered in Birmingham, Ala. Golden Flake Snack Foods, produces, markets, and distributes snack products in the United States. The company has two manufacturing facilities one in Birmingham, and the other in Ocala, Florida.

The company offers salted snack items, such as potato chips, tortilla chips, corn chips, fried pork skins, baked and fried cheese curls, onion rings, and puff corn snacks. It also sells canned and jar dips, pretzels, peanut butter crackers, cheese crackers, dried meat products, and nuts packaged by other manufacturers using the Golden Flake label.

The company distributes its products to various grocery store chains, discount stores, convenience stores, restaurants, and other outlets. It sells its products through its own sales organization and independent distributors to commercial establishments that sell food products in Alabama, Tennessee, Georgia, Mississippi, Louisiana, Kentucky, and South Carolina, as well as parts of Florida, North Carolina, Arkansas, Missouri, Oklahoma, Virginia, Indiana, and Texas. The company was formerly known as Golden Flake Inc. and changed its name to Golden Enterprises Inc. in January 1977.



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