Posted on: Wednesday, April 23, 2003

MacFarms to be sold to Mainland food company

By Sean Hao
Advertiser Staff Writer

MacFarms of Hawaii Inc. yesterday reached an agreement to sell its operations to an unidentified Mainland food company by mid-June.

Financial terms were not disclosed, but the deal will not significantly affect MacFarms' Big Island operations, said president Rick Vidgen. The company's employment, which varies by season, peaks at about 170 people.

MacFarms, founded in 1981, is a subsidiary of Blue Diamond Growers. The almond maker, a Sacramento-based cooperative owned by California nut producers, purchased MacFarms from Campbell Soup Co. in 2000 and is now selling the 4,000-acre South Kona operation to focus on its almond business, Vidgen said.

MacFarms initially announced a sales agreement in November, but the deal fell through.

Under its new owner, MacFarms will gain access to additional retail distribution outlets on the Mainland, Vidgen said. Its products currently are distributed through Costco and Sam's Club.

MacFarms still plans to build a visitors center, growers store and a facility to convert macadamia shells into valuable filter material, Vidgen said. Further business plans will be revealed in June.

"We view this as very positive — a good move," he said.

The sale comes at a trying time for Hawai'i's macadamia nut industry. Farm-level sales rebounded last year to $32.48 million from $29.5 million in 2001, according to the Hawai'i Agricultural Statistics Service. That is still well below 1998 sales of $43.5 million.

Hawai'i's macadamia nut business has been hurt by cheaper imports and a drop in tourism, Vidgen said. MacFarms also faces increased competition from large players such as Planters Peanuts and Frito-Lay.

"The impact of war and the relative collapse of tourism is hard for the market," Vidgen said. "From a marketing standpoint, there's been better times."