The Kroger Co. closed the sale of its Turkey Hill food brand to a Peak Rock Capital affiliate for $215 million.
Financial terms of the deal, which was announced last month, previously weren’t disclosed. Kroger said Monday that it plans to use the after-tax cash proceeds from the sale to reduce debt.
Turkey Hill makes a range of food and beverages, including iced tea, lemonade, fruit drinks, milk, frozen dairy treats and ice cream at its manufacturing and distribution plant in Conestoga, Pa.
"We want to thank Turkey Hill's associates for their dedication and their many contributions to the company," Erin Sharp, group vice president of Kroger Manufacturing, said in a statement. "We look forward to the continued success of the Turkey Hill brand."
Austin, Texas-based Peak Rock Capital, a private equity firm, agreed that its affiliate will continue to operate Turkey Hill from the Conestoga facility with its approximately 800 full-time, part-time and seasonal employees.
According to Robert Pistilli, managing director of Peak Rock, the acquisition of Turkey Hill brings an opportunity “to invest in a premier brand with an established reputation for quality, flavor variety and authenticity within the large and growing ice cream and refrigerated drinks space.”
Peak Rock CEO Anthony DiSimone added that Turkey Hill offers a platform for growth and that the company “will be aggressively pursuing complementary acquisitions to extend the product and brand portfolio."
Along with Turkey Hill, Peak Rock's food and beverage investments include Berner Food & Beverage, Diamond Crystal Brands, Gold Coast Bakeries, Louisiana Fish Fry, Pretzels Inc., Sweet Harvest Foods and TNT Crust.
Kroger had said in early August that it was exploring strategic options for the Turkey Hill food business, including a possible sale. Kroger and Peak Rock unveiled the Turkey Hill deal on March 20.
The transaction doesn’t include Turkey Hill convenience stores. Cincinnati-based Kroger had sold those stores in April 2018 as part of the divestiture of its c-store business to U.K.-based EG Group in a $2.15 billion deal.