Prepared Foods September 19, 2005 eNewsletter
The Hain Celestial group has signed an investment agreement with Singapore-based natural food and beverage company Yeo Hiap Seng (YHS), thereby consolidating its intention to pursue joint interests in food marketing and product development.
Under the terms of the agreement, the firms will make a reciprocal equity investment in each other's shares; further financial details were not disclosed. Together, they intend to pursue R&D ventures in the area of nutrition.
Both companies are currently assessing opportunities to advance their brands into new geographical areas and will look for opportunities. Hain hopes to expand its distribution networks across regions of Asia, including Singapore, Malaysia, Hong Kong and China.
"Building on the infrastructure of YHS and its brand of products, we see a tremendous opportunity for Hain Celestial to source our products in Asia and to bring our natural and organic products into the Asian market," said Irwin Simon, chief executive of the Melville, N.Y.-headquartered group. "Additionally, we are excited to work with YHS to expand the Yeo's brand of beverages and food products in our markets as part of the alliance," he added.
...AND BUYS SPECTRUM Hain has also signed a definitive agreement to merge with fellow U.S. firm Spectrum Organic Products. Under the terms of the deal, Hain Celestial has agreed to pay shareholders of the firm about $ 0.705 per share, consisting of 50% in Hain Celestial common shares and 50% in cash. The transaction, which is expected to close in November and to be accretive to Hain Celestial's earnings, is subject to shareholder approval by Spectrum and other customary conditions.
Spectrum, a California-based food firm that reported sales of $49.9 million for its last fiscal year, manufactures and markets natural and organic culinary oils, vinegars, condiments and butter substitutes under its Spectrum Naturals brand and essential fatty-acid nutritional supplements under the Spectrum Essentials brand, which are sold mainly through natural food retailers.
Commenting on the move, Simon said, "Spectrum has been a well-respected producer of natural and organic oils in the natural food channels for many years, and adding their range of offerings in this category to Hain Celestial's existing portfolio gives us another opportunity to offer our customers additional category-leading products. We look forward to expanding Spectrum Naturals, Essentials and Ingredients businesses as consumers increasingly seek healthy oils as part of a balanced diet."