Fortaleza, April 15, 2008 – M. Dias Branco (Bovespa: MDIA3), Brazil‘s leading cookies, crackers and pasta manufacturer, hereby announces additional information about the acquisition made on April 7, 2008 by its subsidiary ADRIA ALIMENTOS DO BRASIL LTDA., that acquired all the shares of INDÚSTRIA DE ALIMENTOS BOMGOSTO LTDA. (“VITARELLA”), a company headquartered at Jaboatão dos Guararapes, Pernambuco State, Brazil.
The acquired company began its operations in 1993, producing and selling pasta and cookies in its industrial unit located in Pernambuco, under the VITARELLA and TRELOSO brands, among others, holding 5.5% of the Brazilian cookie market and 2.9% of the national pasta market in terms of volume in Jan-Feb 2008 (Ac Nielsen, Jan-Feb 2008).
The acquisition is aligned with the consolidation strategy already disclosed to the market, given the acquired company‘s strong brand and operations in areas in which M. DIAS BRANCO is not market leader, as well as its excellent distribution system and capacity for strong growth with only low levels of investment.
The acquired company is the leader in the states of Paraíba, Pernambuco and Alagoas, and its geographic footprint allows for substantial synergy gains, drawing on: a) the increased vertical orientation of the Company, which will begin to supply raw materials to the acquired operations, i.e. wheat flour and vegetable shortening; b) the dilution of fixed production costs at the milling and vegetable shortening production units of M. DIAS BRANCO, given the higher level of capacity utilization arising from the supply of our primary inputs to the Pernambuco plant; c) the dilution of operating costs, and d) the addition of new products to the current product line of VITARELLA.
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