Grupo Bimbo has signed a $650m agreement to acquire foodservice-focused company East Balt Bakeries (East Balt).

The transaction amount will be paid in cash and is debt-free.

Founded in 1955 and based in Chicago, US, East Balt produces and supplies buns, English muffins, bagels, artisanal bread and other baked goods to quick service restaurants (QSR) worldwide.

Approved by the board of directors of both Grupo Bimbo and East Balt, the deal is expected to close during the second half of this year, subject to customary closing conditions.

“This acquisition continues to fulfil our vision of expanding our global reach to better serve more consumers, with entry to eight new countries."

With this acquisition, Grupo Bimbo intends to further expand in global high-growth segments and markets.

Grupo Bimbo board chairman and chief executive officer Daniel Servitje said: “East Balt brings significant expertise, a remarkable track record of profitable growth, and a geographically diverse and highly scalable platform in the foodservice segment, complementing our current business within this channel.

“This acquisition continues to fulfil our vision of expanding our global reach to better serve more consumers, with entry to eight new countries. Notably, East Balt enjoys long-standing strategic relationships, with the largest and most established QSR brands in the world."

East Balt operates 21 bakeries located across the US, Europe, Asia, the Middle East and Africa, including two joint ventures.

The company has nearly 2,200 employees across its operations and produces nearly 13 million baked goods daily to service more than 10,000 locations.

East Balt CEO Mark Bendix said: “The combination between East Balt and Grupo Bimbo provides exceptional new business opportunities, including broad product capabilities, custom sandwich carriers in the Foodservice channel and expanded global reach. We are pleased to become a part of the Grupo Bimbo family.”

For this deal, Atlas Advisors is acting as financial adviser to Grupo Bimbo, Cleary Gottlieb Steen & Hamilton and White & Case are serving as legal counsels, and Deloitte is acting as diligence adviser.