DALLAS — Cotton Creek Capital, a Dallas-based private equity firm, has acquired San Antonio-based Sterling Foods, L.L.C. Founded in 1971, Sterling Foods supplies gourmet bakery items to the food industry. The company’s products include a variety of specialty and gourmet baked products such as cakes, croissants, bagels, muffins, scones and various specialty dessert items. Financial terms of the transaction were not disclosed.
Sterling is the largest supplier of shelf-stable bakery products to the U.S. military and also provides products to restaurant chains. Additionally, Sterling provides baked goods to the weight management industry and also the K-12 educational market.
Sterling has expanded its customer base and distribution channels over the past decade with the acquisitions of Buena Vista Foods (2007) and Caravan Trading (2010).
Cotton Creek Capital said it believes the next phase of Sterling’s growth will be driven by “a continued focus on the gourmet national restaurant channel, geographic expansion of distribution in the educational market, new product offerings for military customers through an increased investment in research and development, and an investment in equipment and automation aimed at continuous operational improvement.”
Sterling has manufacturing facilities in San Antonio; Azusa and Union City, Calif.Cotton Creek Capital focuses on investing in and growing established lower middle market companies in manufacturing, value-added distribution, industrial, specialty chemical, business services, health care services and consumer staples. The firm invests in companies with enterprise values between $15 million and $200 million in transactions ranging from buyouts, recapitalizations, buy-and-builds to corporate divestitures.