Americold adding Cloverleaf Cold, expanding in Atlanta GA
Americold Realty Trust is growing with two recent developments.
The company, which owns, operates and develops temperature-controlled warehouses, recently agreed to acquire Chiller Holdco from Cloverleaf management and announced plans to expand and redevelop its Atlanta GA campus.
Americold agreed to purchase Chiller Holdco, which operates as Cloverleaf Cold Storage, from Cloverleaf and an investor group led by private equity funds managed by Blackstone, for $1.24 billion. The acquisition’s closing is subject to customary conditions and expected to occur in the second quarter of 2019, the company said.
Cloverleaf, founded in 1952 in Sioux City IA, is the fifth largest cold storage provider in the United States by refrigerated cubic feet. Americold’s acquisition includes 22 Cloverleaf facilities spread across nine states in the central and southeastern US, totaling 132 million refrigerated cubic feet and serving 360 customers.
Upon closing, Americold’s portfolio will consist of more than 2 billion refrigerated cubic feet, the company said, which provides it with “greater density and diversification” to better service its customers.
“We welcome Cloverleaf to the Americold family,” said Fred Boehler, president and chief executive officer of Americold. “We have long admired Cloverleaf, the families that founded them and the associates that helped earn them a great reputation in our industry. We have a similar degree of respect for Zero Mountain, which was recently acquired by Cloverleaf.
“We will accelerate and enhance Cloverleaf’s recently implemented initiatives by leveraging Americold’s commercial platform, institutional quality management and the Americold Operating System.”
Americold said its planned investment in its Atlanta campus, which includes Tradewater, Gateway, Westgate, Southgate and Skygate facilities, is between $126 million and $136 million.
“Given the supply-demand characteristics for temperature-controlled infrastructure in Atlanta, we are extremely pleased to announce our plans to expand our operations in this key market, which we believe will allow us to support new and existing customer growth,” Boehler said. “Furthermore, the expansion of our Atlanta major market campus, and our previously announced development at the Port of Savannah, together will grow our total capacity in the state by over 50% by 2021.
“We believe this targeted investment will enhance efficiencies for both Americold and its customers, and ultimately drive increased profitability and additional long term shareholder value.”
The company’s investment is expected to include fully automated and semi-automated expansion projects, and select redevelopment of its existing Atlanta major market cold-storage infrastructure. The investment will provide additional capacity to support existing customer growth, facilitate capture of new business, improve service capabilities and efficiency, and increase campus profitability, Americold said.
The company said it intends to demolish part of an existing structure at its Gateway facility and build a first-to-market, fully automated facility with approximately 46,600 pallet positions. At its Tradewater facility, the company expects to build a semi-automated expansion, adding approximately 13,600 pallet positions. It also intends to invest capital at its Westgate, Southgate and Skygate facilities on projects intended to enhance efficiencies and better serve its growing customer base.
Americold expects to begin this program in the first quarter of 2020, with completion of the projects targeted for the second quarter of 2021.