Hormel buys Chicago meat company for  $425 million

Published 8:24 am Friday, August 18, 2017

By Evan Ramstad

Star Tribune (Minneapolis)

Hormel Foods Corp. announced Thursday that it bought Fontanini Italian Meats and Sausages, a Chicago-based maker of Italian meats that are chiefly sold to restaurants, for $425 million.

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The company, which was owned by Capitol Wholesale Meats Inc., specializes in sausages, pizza toppings and meatballs and has a new production facility in McCook, Ill., that is considered state of the art.

“The Fontanini brand is highly regarded, and the addition of these products to our portfolio will allow us to accelerate growth for both Hormel Foods food service and for Fontanini,” Jim Snee, Hormel’s chief executive, said in a statement.

The business will continue to be run from the Chicago area as a unit of Hormel’s refrigerated foods division. Hormel said the new Fontanini plant in McCook has capacity for some of its existing products as well.

“Hormel Foods has an excellent reputation as one of the strongest food companies in the world with a track record of successfully acquiring family-owned businesses like ours,” Gene Fontanini, chief executive of Capitol Wholesale Meats, said in the statement.

His father Oriano Fontanini started the business as a meat shop in a predominantly Italian neighborhood of Chicago in 1960. In the 1970s, Gene Fontanini learned the pizza business and steered the family store into become a supplier of meats for pizzerias around the Chicago area. They expanded the company in the 1980s with the purchase of a former Swift Eckrich plant in the Chicago stockyards and eventually launched national distribution.

Hormel executives have been growing the company through acquisitions for several years, adding products like Skippy peanut butter, Muscle Milk and Justin’s nut butters and candies. Analysts more recently speculated the firm would look for deals in the $400 million to $800 million range.

The Austin- based company didn’t immediately spell out how it would pay for the deal.

Distributed by Tribune News Service.