Niagara Fiber LLC has acquired Allied Blending and Ingredients Inc., which provides fiber products. The buyer is owned by private equity firm Arsenal Capital Partners, which is one of many private equity firms to raise a fund recently. 

Allied Blending, headquartered in Keokuk, Iowa, provides fiber and starch-based produces and mixes for the dairy and tortilla markets.

Niagara previously acquired Fibred, which provides soy fiber products for various food markets, in October, and before that, bought International Fiber Corp., a supplier of cellulose-based fiber products for the food, pharmaceutical and industrial markets in August. The company expects the latest acquisition will help it expand in North American and diversify its product portfolio.

Arsenal Capital, headquartered in New York, closed an $875 million fund in April 2013. "First, we go deep into our two sectors and identify growth trends or issues that need to be solved. Then, we intensively scout the market with industry experts to identify companies through which we can implement specific strategic opportunities. We then buy the initial platform and almost always combine it with another asset right at the beginning to create a step function in scale and market positioning," Arsenal's Terrence Mullen told Mergers & Acquisitions.  

In April, the firm bought Synchrogenix, which provides regulatory writing and related services to medical device companies. 

Houlihan Lokey acted as Allied Blending's financial adviser for the deal. 

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