The acquisition means that the joint company will spread across 200 facilities in North America, Europe and Asia covering cold-storage space of 1.3 billion cubic feet.

Lineage Logistics LLC, one of the largest refrigerated storage companies in the world, recently announced that it has acquired Preferred Freezer Services LLC, a temperature controlled cold storage warehousing company, to expand its warehouse footprint to meet the growing demand of fresh foods among consumers.

Sources close to the matter have reported that the deal has been finalized at $1 billion by Lineage which has such reputed companies as Tyson Foods Inc., SyscoCorp., Walmart Inc. and General Mills Inc. among its customers. The deal is expected to be closed by Q22019.

The acquisition means that the joint company will spread across 200 facilities in North America, Europe and Asia covering cold-storage space of 1.3 billion cubic feet. There will be 17 automated facilities where store pallets of goods will be moved by robotic cranes in unlit, low-oxygen rooms. According to an industry group, the combination of Lineage and Preferred, which is the third largest provider of cold storage, can easily surpass the current leader, Americold Realty Trust.

Greg Lehmkuhl, CEO, Lineage has been reported to say that the acquisition can be a game changer as it will broaden Lineage’s footprint and create more options for its customers to store their products.

Experts opine that as consumer tastes hinge toward online ordering and fresh foods, demand for cold-storage space is on the rise and could fuel more new investment and consolidations in the market. Considering that most providers are vying to get closer to the population, industrial refrigerated facilities such as Lineage can provide better service to their customers with more locations.

Reports also suggest that private-equity investors are showing greater interest in cold-storage operations. For instance, D1 Capital Partners and Stonepeak Partners LP along with some existing Lineage supporters acquired minority stakes in Lineage in 2018 for an estimated $700 million.

For the record, controlled by Bay Grove Capital, Lineage was founded in 2008 and built a broad network of facilities partly by the acquisitions of small family-run companies.