Meal-kit delivery company Fresh Prep secures court approval to buy rival Goodfood

Résumé détaillé

Acquisition of Montreal-based Goodfood, which previously filed for creditor protection, expands Fresh Prep’s cross-country footprint

Fresh Prep Foods Inc. said it won court approval to buy rival Goodfood Market Corp. as the meal-kit delivery company bolsters its Quebec business and extends its cross-Canada footprint.

Vancouver-based Fresh Prep will acquire Goodfood’s customer accounts and subscriptions as well as select operating assets, the company said Tuesday. The transaction is expected to close around Nov. 13, after which Fresh Prep will welcome Goodfood employees and start serving about 30,000 Goodfood customers.

Montreal-based Goodfood filed for protection under the Companies’ Creditors Arrangement Act in August, saying its “excessive growth” during the COVID-19 pandemic followed by a steep decline in sales in ensuing years left it unable to pay its debt. It won approval from the Quebec Superior Court to seek a buyer or new investment.

Fresh Prep has managed to steer a different path, which its executives credit to a focus on innovation and value.

The company offers zero-waste meal kits to customers as an alternative to single-use packaging. And it has invested heavily in its operations, technology and automation, giving it greater control over costs, quality and customer experience, company co-founder and co-chief executive Dhruv Sood said via e-mail.

“We’ve been very intentional about how we’ve built Fresh Prep, and that’s put us in a strong position to grow,” Mr. Sood said, adding that annual revenue now tops $100-million. “We see significant opportunity ahead.”

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Launched in 2015, Fresh Prep’s first market outside of B.C. was Alberta in 2021. It then grew further through acquisitions, buying Vancouver’s Peko Produce and Montreal’s Cook It.

The private company is owned by its co-founders and several other investors, notably SEMCAP Food & Nutrition and Renewal Climate Ventures. Its 700 employees now serve customers in five provinces, including Saskatchewan, Ontario and Quebec.

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