Vending Market Watch

Crane Co. acquires Dixie-Narco Inc.

Crane Co. recently purchased all of the capital stock of Dixie-Narco, Inc. for $46 million in cash, from Whirlpool Corp. Dixie-Narco is based in Williston, S.C., where it employs approximately 850 people. Dixie Narco's 2006 sales are estimated to be $165 million.

Brad Ellis, president of Crane Merchandising Systems, said in a prepared statement: "Dixie-Narco is a prestige brand, has great people, and is a leader in innovation, quality and product support. Similarities with Crane Merchandising Systems make Dixie-Narco a complementary fit with our business. This acquisition expands our vending capabilities from our snack, food and coffee focus, and reinforces our position as an industry leader.

"Even though recent market and business conditions have been challenging, Crane is committed to and passionate about the future of vending. Our long-term goal will be to grow the Dixie-Narco business.

"Our strategy will be to blend the engineering talent and intellectual properties of Dixie-Narco, National Vendors and Automatic Products with our payment systems and vending management software technologies to bring meaningful, innovative solutions to the industry."

Ellis said the Dixie Narco business will be maintained as a separate organization with production operations remaining in Williston, S.C.

Dixie-Narco is the fifth business acquisition Crane Co. has made the past year for its merchandising systems division. Others were EMS, CashCode, Telequip and Automatic Products international, ltd.

CMS moves APi work to St. Louis, Mo., adds 100, and opens new St. Paul, Minn. office
Crane Merchandising Systems (CMS) recently completed the integration of the Automatic Products international, ltd. (APi) production operation into its main operating facility in St. Louis, Mo., launching a new era for the APi business. The integration involved moving the production operation from its former headquarters in St. Paul, Minn., a process that ran from June to mid October.

Tom Glomski, vice president of APi and GPL operations for CMS, said the move marks a renewed commitment to APi. In addition to the new manufacturing operation space in St. Louis, CMS has also leased new office space in St. Paul, Minn. for about 30 APi sales, service, research and development and engineering personnel. Glomski, a 7-year CMS veteran, noted that all of these positions are filled by veteran APi employees.

The move to St. Louis has necessitated the hiring of about 100 new employees in that facility to produce the APi lines, Glomski said. The new manufacturing capability will allow APi to present products in all vend product segments, which marks a new direction for the APi brand. "We will have products for every category," Glomski said. "Now our distributors will be able to offer a product in every category. We are committed to both the direct and indirect channels at CMS."

Pat O'Brien, integration manager for the APi acquisition, noted that CMS was able to free existing space in its main facility to allocate dedicated APi production. The new employees include assembly, fabrication and salaried workers.

The new employees are undergoing training in all facets of fabrication and assembly under CMS's "Operational Excellence" program, which focuses on safety, quality, delivery and cost.

As announced back in June, the benefits of the acquisition include the following:

• The dual distribution strategy of separate, but complementary direct and indirect distribution organizations will enable stronger penetration of market channels, market segments and geographic areas.
• Better value to customers via more choice of products and source of supply and service.
• Ensures the long-term value of the installed APi equipment base.
• Enhances the future value of the operators' business.

VTL Group will acquire vending routes from Nor Cal Beverage in N. Sacramento, Calif.
VTL Group Ltd. has agreed to acquire the vending assets of Nor-Cal Beverage, Inc., in North Sacramento, Calif. Nor Cal Beverage remains a beverage bottler and distributor. Tim Willbanks, vending manager at Nor Cal Beverage, will join VTL Group.

VTL will convert the business to its 24seven franchised business model over the next 12 months, with over 22 franchised routes available to be sold.

The purchase includes vending machines and equipment, the benefits of existing contracts and asset leases, and goodwill.

MEI names Wittern as Conlux distributor; MEI ends Dixie-Narco pact
MEI appointed Vendnet, Inc , a Wittern company, as its North America master distributor for Conlux products for the vending industry – effective Dec. 2, 2006. Dixie-Narco and MEI Conlux agreed to terminate their sales, distribution and service agreement, effective Dec. 1, 2006. Until the effective date, Dixie-Narco will remain the distributor of Conlux-branded products.

Owensboro Canteen, Owensboro, Ky., buys Williams Food Service's Elizabethtown division
Canteen Service Co. of Owensboro Inc., based in Owensboro, Ky., recently acquired the Elizabethtown, Ky. division of Williams Food Service Inc., based in Louisville, Ky. Both companies are Canteen franchises.

The asset purchase includes the Elizabethtown branch and about 20 vending routes. This marks the third acquisition this year for Owensboro Canteen, according to Jerry H. Haase, owner of the company. Earlier this year, he acquired some routes from Williams Food Service in Litchfield, Ky., and also acquired Tom's Vending Inc. in Hopkinsville, Ky. from owner John Crenshaw.

Owensboro Canteen now has about 100 routes and 20 attended sites in its six operating facilities: Owensboro, Ky., Bowling Green, Ky., Hopkinsville, Ky., Elizabethtown, Ky., Evansville, Ind. and Vincennes, Ind.

Williams Food Service now operates about 40 vending routes, 35 mobile catering routes, six cafeterias, a commissary and a catering business from its one Louisville facility, according to Steve Payne, company owner.

The recent acquisition was facilitated by Marc Rosset, owner of Chicago, Ill.-based Professional Vending Consultants Inc.

Fresh Brew Group, Houston, Texas, buys routes from Southern Refreshment Services
Fresh Brew Group USA, based in Houston, Texas, has acquired the vending business of its competitor, Southern Refreshment Services, based in Tomball, Texas, from owner Mike Ferguson for an undisclosed sum. The asset purchase does not include Southern Refreshment Services' coffee service business.

Dari Ansari, owner of Fresh Brew Group USA, said the acquisition includes six vending routes and nine vending employees. Fresh Brew Group USA now has a total of 30 routes.

The transaction was brokered by Marc Rosset, president of Chicago, Ill.-based Professional Vending Consultants Inc.

Osborne Coinage buys Van Brook Tokens
Osborne Coinage Co., based in Cincinnati, Ohio, has acquired Van Brook of Lexington, Ky., a long-term partner which will be merged into its TokensDirect Division.

Van Brook President Virgil Vance will continue to provide his expertise in high-security and controlled area distribution, with locally exclusive tokens. Senior Customer Service Rep Dottie Hopkins joined the TokensDirect staff of eight customer service and inside sales representatives.

Established in 1835, Osborne Coinage is America's oldest private mint. It produces and ships over 200 million coins and tokens worldwide. The products include high quality custom minted coins, tokens, medallions, and key chains to service customers in the amusement, car wash, casino, premium and incentives, and specialty token industries.

Jelly Belly Candy Co. will buy Ben Myerson Candy Co.
Jelly Belly Candy Co. has signed an agreement to acquire the candy manufacturing and trade name assets of Ben Myerson Candy Co., Los Angeles, Calif. Ben Myerson Candy Co. manufactures the Christopher's line of chocolates and is the licensee of Sunkist confectionery products, including Sunkist Fruit Gems.

The family candy making heritage of Ben Myerson Candy Co. is much respected and a good fit for Jelly Belly, according to Herman G. Rowland, Sr., chairman of the board.

Jelly Belly Candy Co. expects to move Myerson's candy manufacturing and shipping operations to the company's plants in California and Illinois. The proposed sale of the confectionery business coincides with the announcement of Robert Myerson's retirement after 65 years in the candy business. Ben Myerson Candy Co. opened in 1937, and in 1955 the company acquired Christopher's, one of the oldest candy manufacturers in the country dating back to 1887.

Carter and Luke form West Coast vending brokerage, Focus 365
Veteran vend product brokers Janette Carter and Robert Luke have established a West Coast brokerage, Focus 365, based in Anaheim Hills, Calif. The brokerage already represents about 20 vend product manufacturers and has nine employees. The territory includes Arizona, California, Idaho, Nevada, Oregon, Utah, Washington, and part of Texas.

Carter previously worked at Pacific Brokerage Co. based in Yorba Linda, Calif., where she was director of marketing. Luke was a sales rep at Brea, Calif.-based Elite Foodservice. For information, call 714-998-0365; fax: 714-998-5365.

Pierre Foods to acquire Zartic Inc.
Pierre Foods, Inc. has entered into an agreement to purchase substantially all of the assets of Zartic, Inc. and its affiliated distribution company, Zar Tran, Inc. Zartic, based in Rome, Ga., manufactures, sells, delivers and distributes a variety of food items, including packaged beef, poultry, pork, and veal products. The aggregate preliminary purchase price is $94 million, plus the assumption of certain liabilities, subject to certain post-closing adjustments.

Casey Breen of G & J Marketing buys Central Virginia Vending in Fredericksburg, Va.
Casey Breen recently left his position as Maryland account rep for Palm Harbor, Fla.-based G & J Marketing and purchased Central Virginia Vending in Fredericksburg, Va. from owner Michael Albright. Breen has formed CB3 Enterprises LLC, operating as Central Virginia Vending and Coffee Guys. He has one vending route and one coffee service route.

Microtronic AG names Columbian Coffee and Lincoln County Vending as regional distributors
Microtronic AG, a Switzerland-based manufacturer of a cashless vending, electronic key and data management system, recently named distributors for the East and Central U.S. markets. Columbian Coffee, based in High Point, N.C., has been named eastern distributor under the name Microtronic East. Lincoln County Vending, based in Fayetteville Tenn., has been named central region distributor under the name Microtronic Central.

VTL Group claims it will provide free software to vending operators
VTL Group, based in Auckland, New Zealand and active in the U.S., will offer its vending management software free to U.S. vending operators. A key incentive for making this package available for free is to prevent vending operators from using what's known as the "R" factor, a process where a site sales commission payment is reduced.

VTL Group will make the software available shortly after Jan. 1, 2007, according to Mark Bruno, president of Service America Group Inc., the Boston, Mass.-based U.S. affiliate of VTL Group. Vending operators will have online access to a database that will allow them to compare their sales and financial data to other businesses of similar size and geographic region, Bruno said.

Vending operators will be able to input data using handheld computers, route cards or via remote machine monitoring, depending on their existing hardware and software. VTL will also assist operators who wish to upgrade management hardware and software.

Eskimo Pie will sell off certain DSD assets to Southwest Traders
CoolBrands International Inc.'s subsidiary, Eskimo Pie Frozen Distribution, Inc., has entered into definitive agreements to sell its "direct store door" frozen distribution assets in Florida, California, Oregon and Washington to Southwest Traders, Inc. for net consideration of approximately $5 million.

Le-Nature's declares bankruptcy
Le-Nature's Inc., which makes bottled waters, teas, juices and nutritional drinks, has been forced into bankruptcy by a group of creditors who seek more than $1.4 million, according to The Intelligencer in Doylestown, Pa. The company's products have been exhibited at vending trade shows for several years.

The move came after a Delaware judge appointed a turnaround firm, Kroll Zolfo Cooper LLC, as custodian of the Latrobe, Pa.-based company after concluding it had engaged in potentially criminal activity, according to court documents.