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Utz Brands orders up some chips and salsa as it continues geographic growth in salty snacks

Utz Brands, the regional chip and pretzel brand that has become an adopted favorite of Baltimore-area snackers, has acquired one of the nation’s top makers of tortilla chips, salsa and queso.

Utz purchased Truco Enterprises, a division of the On The Border brand, from Insignia Capital Group for $480 million, it announced Thursday.

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The deal, expected to close in December, increases the Hanover, Pennsylvania-based Utz’s standing as a top purveyor of chips and other salty snacks.

Utz CEO Dylan Lissette said On The Border ranks third in the tortilla chip subcategory of salty snacks, and provides the chip company with new gains in the dip category, which significantly diversifies its portfolio. It also expands Utz’s geographic reach.

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“This acquisition strengthens our competitive position, as well as our financial profile,” Lissette said in a statement. “We are confident this transaction will drive long-term value creation for our stockholders and help position us for continued long-term growth.”

Utz shares surged more than 6% in Thursday trading to close at $18.20 each.

The $28 billion salty snack retail industry grew 10% over the past year, according to the release. Following the transaction, Utz would have about $1.3 billion a year in retail sales.

Truco CEO Shane Chambers said the acquisition will allow the chip and salsa enterprise to sustain its fast-growing trajectory.

“Utz will be able to leverage its world class Direct Store Delivery network to help expand our brand into new markets," he said in a statement. “As a result, more consumers across the U.S. will have access to our delicious, high quality tortilla chips and dips.”

Truco will become a wholly owned indirect subsidiary of Utz.

Utz went public as Utz Brands Inc., with trading starting in late August on the New York Stock Exchange. The former family-owned Utz Quality Foods merged with consumer goods acquisition firm Collier Creek Holdings to form a public company.

Baltimore has been part of Utz’s core market ever since its founding nearly a century ago. The brand accounts for almost half of the region’s potato chip sales, according to Information Resources Inc., a Chicago market research company.

Utz now owns a snack portfolio that includes Truco, Zapp’s, Golden Flake, Boulder Canyon, TORTIYAHS! and other brands. It makes potato chips, pretzels, cheese snacks, veggie snacks, pork skins and tortilla chips at 14 U.S. manufacturing plants in Pennsylvania and seven other states.

The family owners, who include Lissette, have spent the past decade building Utz into a national brand through acquisitions and geographic growth.

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