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The world’s leading meat processor, Tyson Foods Inc. (TSN - Analyst Report), is geared to strengthen its foothold in Mexican cuisine by buying assets of California-based Circle Foods LLC from Claridge, from Claridge Inc., a Montreal-based private equity firm.

Private equity firm Claridge has investments and equity stakes in real estate, entertainment industries  and food businesses as Plats Du Chef of Montreal and La Terra Fina of California. The financial terms of the deal finalized on Jun 1have not been disclosed.

Tyson does not plan any operational changes in Circle Foods and intends to keep its management team intact.

The acquisition is of great benefit to Tyson Foods as it is presently putting great focus into expanding its Mexican food offerings. It will add the popular brands to Tyson’s portfolio. Circle Foods owns popular brands like Nuevo Grille and Tortillaland handheld Mexican products, Tortillaland uncooked tortillas and ROTILAND Indian flatbreads. It also produces private brands for several customers.

It also will add a Circle Foods’ state-of-the-art facility plant in San Diego, which is known for its strong food safety management system. The plant hproduces burritos, enchiladas, chimichangas, tacos, quesadillas and tamales, as well as tortillas and Indian flat breads.

Tyson’s focus on Mexican food as is also evident from its strategic acquisition of the Mexican snacks and tortilla producer, Don Julio Foods of Clearfield, Utah in Apr 2013.

Tyson Foods’ focus on Mexican food comes at a time when Mexican food is becoming increasingly popular in the U.S., with more and more Mexican-inspired cuisines being offered by fast-casual and quick-service operators. Companies like Taco Bell, Chuy’s Holdings Inc. (CHUY - Snapshot Report), Chiptole Mexican Grill Inc. (CMG - Analyst Report) and Yum! Brands Inc. (YUM - Analyst Report) are popular restaurants offering Mexican delicacies in the U.S.

Tyson’s endeavor to adapt to the changing demand of low-calorie protein foods is encouraging. In Jan 2013, Tyson joined forces with healthy and low-calorie food specialist, Hungry Girl Lisa Lillien, to provide new variants of low-calorie meals for calorie-conscious customers.

It also teamed up with a non-government organization, Alliance for a Healthier Generation, to provide affordable and easily available food products to school children which adhere to federal nutrition standards.

Tyson currently holds a short-term Zacks Rank #3 (Hold).

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