Cal-Maine Foods Eyes Long-Term Growth with Echo Lake Foods Acquisition

Cal-Maine Foods has acquired Echo Lake Foods to expand its value-added egg products category. The acquisition complements Cal-Maine's recent acquisitions, boosting its offerings beyond shell eggs. Echo Lake Foods generated $240 million in revenue in 2024, with expected annual synergies of $15 million. The deal is expected to be mid-single digit accretive to Cal-Maine's earnings starting in fiscal 2026. The U.S. Prepared Breakfast Food market has a CAGR of 11.7% and growing demand for egg-based products.

Cal-Maine Foods, Inc. (NASDAQ: CALM) has completed its acquisition of Echo Lake Foods, further diversifying its product offerings and entering the value-added egg products market. The acquisition, announced in April and finalized on June 2, 2025, was conducted in an all-cash transaction valued at approximately $258 million. After accounting for an anticipated tax benefit of around $28 million, the effective purchase price of the acquisition is estimated at approximately $230 million [1].

Echo Lake Foods, based in Ridgewood, New Jersey, specializes in the production, packaging, marketing, and distribution of ready-to-eat egg products and breakfast foods, including waffles, pancakes, scrambled eggs, frozen cooked omelets, egg patties, toast, and diced eggs. The company generated approximately $240 million in revenue in 2024, with a five-year compound annual growth rate (CAGR) of approximately 10% [1].

The acquisition aligns with Cal-Maine Foods' strategic goal to expand and diversify its product portfolio and customer mix. By integrating Echo Lake Foods, Cal-Maine aims to leverage the latter's extensive sales and supply chain distribution capabilities, as well as its strong customer relationships in the retail, quick-service restaurant, and broader food service channels [1].

The transaction is expected to unlock long-term growth opportunities and reduce earnings volatility. Management estimates a mid-single-digit percentage accretion to earnings per share (EPS) in fiscal year 2026, driven by annual cost synergies of about $15 million. These synergies are expected to result from better efficiency in egg procurement and savings in selling, general, and administrative (SG&A) expenses [1].

Cal-Maine Foods, the largest producer and distributor of fresh shell eggs in the nation, will now offer a wider range of egg-based products. The U.S. prepared breakfast food market has a CAGR of 11.7%, indicating strong demand for egg-based products [2].

References:
[1] https://finance.yahoo.com/news/cal-maine-foods-closes-acquisition-200500088.html
[2] https://www.insidermonkey.com/blog/cal-maine-foods-inc-calm-completes-acquisition-of-echo-lake-foods-1546261/