Quitting your full-time job to perfect the potato chip may sound like a bad business plan, but it worked for Bill Utz in 1921, when he founded Pennsylvania-based Utz Quality Foods (now run by third-generation family members). A leader in the snack foods market, Utz produces 1 million pounds of potato chips a week. The firm also makes pretzels, cheese curls, onion rings, popcorn, and pork rinds, as well as sunflower, tortilla, and corn chips. Utz's snack items are sold throughout the US by national chains, including BJ's Wholesale, Costco, and Wal-Mart. In mid-2011 Utz acquired Zappe Endeavors, which is known for its Zapp's, Dirty, and California chip brands.
For Utz, the acquisition offers wider distribution for its vast products portfolio. Zapp's chips, which have Cajun seasonings and names like Spicy Cajun Crawtator, are kettle-cooked in peanut oil and sold throughout the South, the Northeast, and the Midwest. Zappe's Dirty and California natural chip brands are more lightly seasoned and are a hit on the East and West coasts. The purchase of Zappe also included its plants in Louisiana, California, and Pennsylvania; as part of the deal, Utz plans to expand Zappe's existing 88,000-sq.-ft. Gramercy, Louisiana, plant by 30,000 sq. ft. by 2016. Utz anticipates that with broader distribution and stronger operations (including more employees), it will be able to boost earnings generated by Zappe's brands. Zappe Endeavors continues to operate as a division of Utz. The southern chip manufacturer's fate was spurred along after the death of founder Ron Zappe; he had intended to sell the company he established in 1985.
The agreement to acquire the Zapp's chip business follows Utz's failed attempt to be purchased by Snyder's of Hanover. Looking for some leverage among the growing snack-foods market, Utz agreed in October 2009 to be taken over by Snyder's of Hanover. However, the deal was called off less than two weeks after the announcement was made, with both companies stating that since the takeover had not been cleared by the Federal Trade Commission (FTC), they decided to cancel the deal because getting FTC approval would likely have been a protracted approval process. Both companies also said they preferred to get on with their businesses and not partake in time-consuming negotiations with the government, which, they added, would be detrimental to their companies. By late 2010, however, Snyder's of Hanover had merged with Lance to create Snyder's-Lance and a $1.6 billion company.
Not resting on its laurels, the snack foods maker continues to pump out more products. In mid-2010, Utz rolled out a new range of pretzels under the Utz Specials name that includes flavor varieties unsalted sourdough, extra dark, sourdough, and multigrain. The company in 2010 also extended other lines, such as its dip cups with a new Salsa version. – less
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