Cal-Maine buys egg producer for $110M to grow presence in the Northeast

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Dive Brief:

• Cal-Maine Foods, the largest egg producer by volume in the U.S., last week acquired ISE America, one of the top 25 egg producers, for $110 million in cash.
• The purchase will give Cal-Maine access to ISE’s facilities, which account for roughly 4,000 acres of land and 4.7 million egg-laying hens, one million of which are cage-free. Cal-Maine will also obtain feed mills and an egg products breaking facility, according to the press release.
• Sherman Miller, Cal-Maine’s president and CEO, said the purchase will help the egg producer expand capacity in the Northeast where it does not have a strong presence. The transaction will include production assets in Delaware, Maryland and New Jersey.

Dive Insight:

Miller said the acquisition drives greater value to Cal-Maine’s shareholders and further validates the egg giant’s operating model.

“ISE has a long history in the egg production business and enjoys a solid reputation in the marketplace,” Miller said. “We will continue to honor this important legacy as we build new connections and customer relationships.” 

The purchase follows Cal-Maine’s other acquisitions to expand its operations in recent years. In January, the company announced its purchase of an egg-grading facility in Missouri previously owned by Tyson.

Mississippi-based Cal-Maine has been heavily impacted by volatility in the egg space. The company posted record earnings in early 2023 as bird flu caused the price of eggs to spike. But in April, the company ceased operations at a Texas facility after the virus was detected among its flocks. The discovery resulted in the depopulation of roughly 2 million birds. The addition of more birds further expands its ability to produce eggs.

In its most recent earnings report in April, Cal-Maine reported net sales of more than $703 million, a 30% decline in sales from a year ago due to a decline in egg prices. Miller said in the press release that while bird flu continues to drive higher prices for eggs, the overall impact on the commodity has not been as severe as it was in 2023.