Marcella Scarlett, Business Reporter
Salada Foods' new subsidiary, Mountain Peak Food Processors Limited, will be reintroducing the Roberts brand of jams and jellies and other canned foods to the market by mid-year.
Mountain Peak was used as the vehicle to acquire 80 per cent of the assets of Roberts Products Company Limited for J$34.6 million last year. The other 20 per cent was retained by the original owners of the company.
Chairman of Salada Foods Jamaica Limited, John Bell, said the assets include plant and property, machines and equipment, trademarks and certain inventories, and that no liabilities were transferred in the deal.
Bell said Salada has been on the lookout for new areas of investments for some time, hoping to diversify its offerings and when the opportunity arose in May 2012 they entered into the agreement to acquire these assets.
He said the product line will remain substantially the same, but there is also the prospect of introducing new products in the future.
The Roberts lines include baked bean, syrups, canned juices, jams and jellies, sauces and spices. These will add to the mostly coffee-based products that Salada manufacturers under the brand Jamaica Mountain Peak.
Bell said Salada would be retaining the brand name Roberts because it is recognisable both locally and internationally.
"We bought a company called Robert's Products Company Limited last year that had a pretty good reputation, both local and international, in terms of its products. The brand was recognisable. However, they were having some problems and the products started to dwindle until eventually they shut down," Bell told the Financial Gleaner on the margins of the company's annual general meeting on Wednesday.
"We are resuscitating the company, refurbishing it with the intention to get it back up and running. We are setting up to be running in the next few months ... maybe three months, so we expect that by the end of the financial year we will have something good to report on," he said. "We might get to market a little after that, but we should be manufacturing by then."
Bell said Mountain Peak Food might not be "as profitable as we would like immediately", but he also said Salada does not expect the operation "to be a drag on earnings, not even initially".
Julian Rodney, general manager of Salada Foods, said he is expecting positive returns from the new subsidiary by the end of the year.
"I would say probably that it was undercapitalised, but based on the backing that Salada has put in we are also ensuring we are compliant with international standards. Right now, we are modelling the manufacturing area so that it can meet the international standards so that we can export without restrictions, and that should help with our bottom line," said Rodney.
In the meantime, Bell said that Salada, whose core business is coffee processing, intends to continue expansion into overseas markets and that the focus would largely be on China this year.
"Right now, we are looking at China. We have sent several persons out there to talk to distributors, and we are talking to people who buy from us in the States and Canada to try to expand, to build out in those markets that they are already in, but the main new thrust is China," he said.
Salada is just in the process of registering its trademarks in Asia's fastest-growing and the world's second-largest economy, but Bell said the point at which the coffee company actually enters the market is unclear.
"China will take time, so I can't say how long that will be to bear fruit; that is a pretty big market to get into," he said.