Premium Brands Holdings is acquiring U.S.-based Stampede Culinary Partners in a cash-and-stock deal valued at more than US$660 million, expanding its production footprint and adding new processing capabilities south of the border.
BNN Bloomberg spoke with Rebecca Teltscher, portfolio manager at Newhaven Asset Management, about why the deal fits the company’s long-term growth strategy, how it was financed and what it signals for investors as U.S. markets face rising volatility.
Key Takeaways
- The acquisition expands U.S. production capacity and adds sous vide capabilities, supporting national product launches and long-term growth.
- Management funded the deal partly through equity issuance, reflecting a conservative approach aimed at limiting leverage and strengthening the balance sheet.
- After years of heavy capital spending, the company appears to be reaching an inflection point as new capacity begins to translate into accelerating sales.
- The transaction is expected to be immediately accretive, with additional synergies anticipated as integration progresses over the next two years.
- Broader market conditions may become more volatile as interest rate tailwinds fade and investor enthusiasm around artificial intelligence cools.
Read the full transcript below:
ANDREW: Premium Brands Holdings, a producer of specialty foods including prepared sandwiches, is buying U.S.-based Stampede Culinary Partners for more than US$660 million in a cash-and-stock deal. Let’s get more on what the acquisition means for investors. We’re joined by Rebecca Teltscher, portfolio manager at Newhaven Asset Management. Rebecca, great to see you. Happy Friday.
REBECCA: Happy Friday.
ANDREW: Are you a shareholder in Premium Brands, and how long have you been following the name?
REBECCA: We are shareholders, and we actually added to the position a few weeks ago. It was also my top pick on BNN Market Call last week. We think management has been doing all the right things in terms of investing in the business.
Over the past few years, they’ve been quietly expanding production capacity in the United States. They’re already very well established in Canada, and many of their large customers — for example, Costco — have asked them to bring those products into the U.S. market. Expanding nationally in the U.S. is a very different undertaking than in Canada, given the scale and number of distribution points, so Premium Brands has spent several years building out that capacity.
They’ve invested roughly $750 million in new U.S. capacity, and that buildout is now largely complete. As a result, the stock was fairly flat for a number of years, similar to what we see with pipeline investments, where capital is deployed upfront and returns come later. We believe the company is now reaching an inflection point.
They’ve just launched their largest new product rollout to date — an organic, sugar-free meat stick — across the United States, with a Canadian launch coming soon. That product is already gaining traction.
The acquisition of Stampede fits well with their strategy. Stampede has significant unused capacity in the U.S., strong relationships with major club retailers, and introduces sous vide cooking capabilities, which are new for Premium Brands. We view this as a very strategic and conservative transaction.
Management took advantage of a strong share price to issue equity, limiting additional debt and allowing them to reduce leverage. While the stock is under pressure in the near term due to the equity issuance at a discount, we remain very confident in the long-term outlook.
ANDREW: The stock is actually up a bit this morning, but did it fall yesterday because of the equity issue?
REBECCA: Yes. The stock was trading around $102 before the announcement, while the equity was priced at $97.50, which is a meaningful discount. The shares then traded below that level, which we don’t fully understand, but our long-term conviction remains unchanged.
It’s rare to find such a disciplined management team that consistently executes without taking unnecessary risks. They haven’t always received credit from the market, but we’re starting to see that change. For example, RBC upgraded the stock a couple of quarters ago.
When acquisition opportunities were limited, the company returned capital to shareholders, delivering roughly 10 per cent annual dividend increases. This year, they’re holding the dividend steady as they prioritize growth opportunities, which we view as a prudent capital allocation decision.
ANDREW: If we look at a longer-term chart, the stock fell during the pandemic, rallied into 2021 and then pulled back before climbing again more recently.
REBECCA: That’s right. Most of their sales go through grocery and club channels, though they also have exposure to food service and convenience stores. Their products are positioned at the premium end of the market and are sold through retailers like Farm Boy, Trader Joe’s and Starbucks.
The stock sold off during the pandemic, like most consumer names, and earlier this year amid tariff concerns. However, the company has limited cross-border exposure, with distribution operations in both Canada and the U.S.
Interestingly, management has noted that a tougher trade environment could actually create acquisition opportunities at more attractive valuations. They’ve said the current M&A environment is among the best they’ve seen in their history.
With capacity now in place, organic growth accelerating and acquisition opportunities improving, we believe the company is well positioned. We’re already seeing that reflected in the early success of their recent product launches.
ANDREW: You’re referring to the sugar-free meat stick.
REBECCA: Yes — organic and sugar-free. You’d be surprised how much sugar is in many packaged foods.
ANDREW: They also have large sandwich facilities in the U.S. and hold a meaningful share of the packaged sandwich market.
REBECCA: Exactly. One concern in past years was their exposure to Starbucks when store traffic slowed, but overall coffee shop demand continues to grow. Premium Brands supplies prepared foods across much of the Canadian coffee market, and there’s a clear opportunity to replicate that model in the U.S.
They operate under dozens of banners, which reduces brand risk. Consumers may not recognize the company name, but their products are everywhere.
ANDREW: Rebecca Teltscher of Newhaven Asset Management. Thanks very much.
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This BNN Bloomberg summary and transcript of the Dec. 12, 2025 interview with Rebecca Teltscher are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
