Utz Brands plans to acquire Truco Enterprises of Carrolton, Texas, for USD480m, the company announced. Truco is a manufacturer of tortilla chips, salsa and queso sold under the On The Border (OTB) brand. This will enable Utz Brands to get a solid foothold in the USD6.2bn retail tortilla chip category, which is the second most important sub-category in salty snacks, according to Utz.

“This strategic acquisition will make Utz a significant competitor in the tortilla chip sub-category, where OTB holds the third position and also provides us with a meaningful position in salsa, queso and dips,” said Dylan Lissette, chief executive officer of Utz.

Utz Brands expects Truco Enterprises to generate USD195m in net sales during fiscal 2020. Once the acquisition is complete, Utz Brands will have approximately USD1.3bn in total retail sales.

Harris Williams, a global investment bank specializing in M&A advisory services, announced it was advising Truco Enterprises on its pending sale to Utz Brands, Inc.

“There is strong consumer demand in the snacking sector and Truco’s market share, performance and brand positioning within its product categories were key drivers of interest in the business,” said Tim Alexander, a managing director at Harris Williams. “Truco has found a fantastic partner in Utz and we look forward to seeing how the brand will evolve under new ownership.”

Founded in Dallas in 1991, Truco is a leading developer and marketer of tortilla chips, salsa and queso under the OTB® brand. The company’s products are sold nationally through grocery retailers, club stores and mass merchandisers. Truco is the exclusive licensee of the OTB® brand for food products sold through retail.