P. LEINER ACQUISITION OF FRESHLABS INCLUDES $ 20 MIL. NATURITE
P. LEINER ACQUISITION OF FRESHLABS INCLUDES $ 20 MIL. NATURITE product line. Announced Oct. 10, the undisclosed cash and notes transaction is expected to close by the end of the month, the vitamin/nutritional supplement products firm said. The move adds further marketing muscle to P. Leiner's national distribution network, especially among the supermarket chains, a growing distribution channel for vitamins and nutritional supplements. Torrance, California-based P. Leiner, the largest full-line supplier of vitamins and related products, currently has annual sales of about $ 100 mil. "The addition of Freshlabs will further expand our national distribution and bring us some important new customers including several major supermarket chains," P. Leiner Chairman Michael Leiner remarked. "Supermarkets are a substantial and growing distribution channel for our products and, after completion of this transaction, we will be serving 21 of the top 25 supermarket chains in the U.S." Freshlabs is P. Leiner's second acquisition of 1988. In February, the company reached the $ 100 mil. per year sales level with the purchase of Vita-Fresh, another California firm, for an undisclosed amount. "Our plans call for the development and/or acquisition of allied product lines and brands that can be distributed to our growing, nationwide customer base," Leiner explained. "Other possible acquisitions remain under review." The acquisition reflects two trends in the vitamin/nutritional product industry -- the increased sales by mass market retailers at the expense of health food stores, direct sales and mail order businesses; and greater pricing pressure on smaller manufacturers. "We believe that joining forces with P. Leiner will benefit the development of our business and enable us to offer expanded service to our customers," Freshlabs President Merle Harris added. "The combined company clearly has strength, stability and considerable momentum as the industry's pacesetter." A privately-held manufacturer of vitamins and nutritional supplements, Freshlabs also produces OTCs and bulk tablets. The company is located in Warren, Michigan and has been in business almost 50 years. Freshlabs operates a 60,000 sq ft headquarters facility and tablet manufacturing plant in Warren and an 80,000 sq ft packaging and distribution center near Toledo, Ohio. Freshlabs will continue to operate as an independent entity, P. Leiner said, within P. Leiner Nutritional Products. "Freshlabs is a very efficient producer with good manufacturing technology and well-equipped facilities," Leiner continued. "The acquisition will create some immediate synergies as we spread our marketing and sales expenses over a larger base and achieve other economies of scale. Furthermore, we will be able to provide our new customers with access to P. Leiner's advanced marketing programs and broader product lines."
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