010393 Foster Farms Acquires Chicken Ops of Zacky Farms

Livingston, CA and El Monte, CA - Foster Farms and Zacky Farms announced that they have entered into a definitive agreement for Foster Farms to acquire the chicken operations of Zacky Farms for an undisclosed amount. The completion of the acquisition is subject to regulatory approval.

Under the terms of the agreement, Foster Farms will acquire Zacky Farms' Fresno area plant, hatchery, feed mill, and 35 live production ranches as well as its Los Angeles distribution center, adding 165 million pounds to its current annual poultry production. Zacky Farms' fully integrated turkey operations (including the growing, processing, distributing and wholesaling of fresh turkey) and its deli and further processed meat operations will remain under ownership and management of the Zacky family.

Once the transaction is finalized, Foster Farms executives will assume management of the combined chicken operations. Chicken produced out of the former Zacky Farms facilities will be transitioned to the Foster Farms brand name and packaging. Substantially, all of Zacky Farms' chicken operations workforce will be offered positions with Foster Farms.

“Zacky Farms is an ideal acquisition because it fits with Foster Farms' operations and high quality standards while providing Foster Farms the opportunity to broaden its client base and offer existing customers a wider range of products,” said Foster Farms CEO Paul Carter.

Zacky Farms President and second-generation family member Robert Zacky said, “I am proud of Zacky Farms employees for their contribution to making the company a successful venture. With Foster Farms, another family-owned business, they will carry on the tradition of excellence and quality that my family valued so highly. I am confident that consumers and customers will experience a seamless transition.”

Following the completion of the transaction, Foster Farms will integrate Zacky Farms' chicken operations into its own. As with its existing operations, Foster Farms will strictly control the entire poultry production process from the time the egg is laid to the delivery of the chicken to the grocery store.

The transaction is expected to close mid-2001, subject to regulatory approval. J.P. Morgan acted as Foster Farms' and Credit Suisse First Boston acted as Zacky Farms' financial advisors on the transaction.

About Foster Farms

Foster Farms, with more than $1 billion in annual revenues, is the largest poultry producer in the Western United States. Based in Livingston, Calif., the company has remained a family-owned business since its founding in 1939. In addition to fresh chicken, Foster Farms produces fresh turkey, a marinated fresh chicken line, deli meats, corn dogs, a variety of cooked chicken products and refrigerated chicken entrees. The company employs more than 9,000 people and produces and delivers 750 million pounds of fresh chicken and turkey each year to retailers, warehouse clubs and foodservice customers throughout the West.

About Zacky Farms

Family-owned Zacky Farms, founded more than 70 years ago, ranks among the largest chicken businesses and turkey businesses in the United States. Upon completion of the acquisition, Zacky Farms will continue to rank among the largest turkey businesses in the United States. Growing from a small, family-run retail business, Zacky Farms is a completely integrated turkey and chicken grower, processor, distributor and wholesaler, with net sales in excess of $350 million annually. In addition, Zacky Farms is a top feed and grain manufacturer and merchandiser in Central California's San Joaquin Valley. The company employs more than 3,000 people.

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