Food Industry Acquisition Report: March 2018
Surveying strategic acquisitions across the food and beverage industry
Major ingredient suppliers, technology-driven, on-demand grocery businesses and high-end confectionery companies all experienced activity in the world of acquisitions last month.
Here are a handful of acquisitions that have taken place in the past 30 days or so.
PPC Partners Acquires Guenther & Son Inc.
PPC Partners announced the acquisition of C.H. Guenther & Son Inc. (CHG), a producer of branded and private-label food products for foodservice, quick-serve restaurants, club and retail customers around the globe. The acquisition was led by PPC Partners in partnership with co-investors and management who will continue to lead the company.
Headquartered in San Antonio, CHG was founded in 1851 by German immigrant Carl Hilmar Guenther and has been continuously owned by Guenther family members since its founding. The family-owned company is a leader in the manufacturing and marketing of a wide variety of grain-based and seasoning products, including artisan breads, buns, rolls, biscuits, gravy mixes, frozen appetizers, spices and desserts. The company employs more than 2,500 people in 19 SQF level 3 food manufacturing locations in the US, Canada and Western Europe.
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PPC Partners
C.H. Guenther & Son Inc.
Land O’Frost Purchases Wellshire Farms
Land O’Frost, a producer of pre-sliced deli meats and specialty sausage products, announced that it has purchased Swedesboro, NJ based Wellshire Farms, Inc. Wellshire is a company operating in the natural/organic meat space whose products are sold in specialty grocery retailers such as Whole Foods Market, Trader Joe’s, Sprouts Farmers Market, Earth Fare and Natural Grocers by Vitamin Cottage. Following this transaction, Land O’Frost immediately becomes a significant player in the fast growing natural/organic category.
This transaction brings together family-owned and operated companies in the meat industry. As part of the deal, Land O’Frost will acquire all of Wellshire’s assets, including its entire brand portfolio, which features the Wellshire, Wellshire Organic, Wellshire Kids, Garrett Valley, Colameco’s, Colameco’s Primo Naturale, Lou’s Famous and Woodstown Farms and Homestyle Meals brands.
This acquisition directly supports Land O’Frost’s strategic growth plans. As one of the fastest growing brands in the industry, the company is always looking to enter new categories that complement its existing portfolio. With the addition of Wellshire, Land O’Frost’s product portfolio now features a vast offering of recognized natural/organic brands that include breakfast meats, deli meats, hams, hot dogs, snacking and specialty meats.
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Land O’Frost
Wellshire Farms
Ferrero Completes Acquisition of Nestlé USA’s Confectionary Business
The Ferrero Group and its affiliated companies (“Ferrero”), a global confectionary group, announced that it has completed its previously announced acquisition of Nestlé USA’s confectionary business, with more than 20 iconic American brands, including chocolate favorites such as Butterfinger®, BabyRuth®, 100Grand®, Raisinets®, Wonka® and the exclusive right to the Crunch® brand for confectionary and certain categories in the US, as well as sugar brands such as SweeTarts®, LaffyTaffy®, and Nerds®.
Lapo Civiletti, CEO of the Ferrero Group, added, “This is an important moment for the Ferrero Group, and we are confident that our commitment to deliver value to North American consumers and customers will be strongly enhanced by the addition of these powerful brands to our portfolio.”
Nestlé USA’s three confectionary manufacturing facilities in Illinois and associated office space in California will be managed by the Ferrara Candy Company, which was acquired by a Ferrero affiliated company in 2017.
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The Ferrero Group
Bodega Latina to Acquire Fiesta Mart
Bodega Latina Corporation (“Bodega Latina”), doing business as “El Super”, a US Hispanic grocer and a subsidiary of Grupo Comercial Chedraui, S.A.B. DE C.V. (“Chedraui”), has agreed to acquire Fiesta Mart, L.L.C. (“Fiesta”). Fiesta, a portfolio company of ACON Investments, L.L.C., is a Texas-based international food retailer with an emphasis on the Hispanic segment operating 63 stores primarily in the Dallas and Houston areas.
The combination of Bodega Latina and Fiesta creates one of the largest Hispanic-focused supermarket companies in the US, with a total of 122 stores across California, Arizona, Nevada, New Mexico, and Texas and revenues of approximately US$3 billion. Over 50% of the fast growing US Hispanic population resides within the five states in which the company operates. The acquisition brings together best-in-class practices across both retailers to further enhance the customer shopping experience via improved pricing, quality and customer service.
The transaction is currently expected to close at the beginning of the second quarter of 2018, subject to customary closing conditions. Fiesta stores will continue to be operated under their own banner.
RBC Capital Markets, L.L.C. served as exclusive financial advisor and Sidley Austin L.L.P. served as legal advisor to Bodega Latina, respectively. The Food Partners, L.L.C. served as exclusive financial advisor and Hogan Lovells US L.L.P. served as legal advisor to Fiesta, respectively.
Learn more about these companies.
Bodega Latina Corporation
Grupo Comercial Chedraui, S.A.B. DE C.V.
McCain Brazil and Forno de Minas to Partner
McCain and Forno de Minas entered into an agreement under which McCain will acquire a 49% interest in Forno de Minas.
Regarding the agreement, Helder Mendonça, CEO of Forno de Minas, who will continue in this role, following the completion of the transaction, said: "This partnership will certainly be very favorable to the growth of both Forno de Minas and McCain's businesses. We jointly have opportunities to expand our business in Brazil, as well as in the world market. We want to continue bringing to the family table high quality products that have the taste of home made. We are very pleased to join forces with a company that values as much as we do product quality, partnership with customers and consumer preferences. "
Paolo Picchi, regional president of McCain Foods Latin America commented: "This agreement presents a great opportunity for both companies, which have very strong brands in the Brazilian market. We are confident in the success story of Forno de Minas and in the management of the Mendonça family to continue to lead the company. McCain Foods and Forno de Minas have complementary appetizer and snacking strategies and both have a proud commitment to high-quality products and excellent customer service. This partnership presents a fantastic opportunity for both companies to strengthen and grow their presence in this important market sector here in Brazil.”
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Forno de Minas
Carrington Farms Acquires Organic Whey Protein Brand
The Carrington Tea Co. LLC DBA Carrington Farms announced it has acquired tera'swhey, a whey protein in the US, of Madison, Wisc. Founded in 2009 and made from grass fed dairy cows in Wisconsin, tera's is the first and most complete line of USDA certified organic whey proteins in the US – tera'swhey has sustained substantial year over year growth in the whey protein space since their inception.
Carrington Farms is a natural foods industry innovator that has pioneered the Simple.Clean.Real. philosophy for its products, distributed in retailers nationwide. tera'swhey products and approach are very closely aligned with Carrington Farms' real food philosophy which embodies the ideals that the brand will only make the product if they would feel confident in feeding it to their own family. The acquisition will help accelerate Carrington Farms' efforts to deliver protein powders that meet consumers' changing tastes and preferences. The acquisition will also further Carrington Farms' efforts to drive innovation in the health and well-being space within the protein powder set, while giving the company even more access to supplement purchasing customers and channels.
Learn more about these companies.
tera'swhey
Instacart Acquires Unata
Instacart, the technology-driven, nationwide on-demand grocery delivery service, announced it has acquired Unata, the award-winning provider of 1-to-1 digital solutions for grocers. Together, the ecommerce pioneers plan to enable the future of online grocery shopping, combining their talented teams, vibrant cultures, and innovative products to accelerate the process.
The acquisition, which bridges Unata's comprehensive white-label digital grocery platform with Instacart's established technology and scale, will create a one-stop shop for brick-and-mortar retailers to effectively compete in an increasingly online world.
Unata – whose headquarters will remain in Toronto – will become an independent subsidiary of Instacart, maintaining its name and brand. Instacart will continue to invest in innovation and resources for both Unata and Instacart as the companies merge into a single powerhouse platform. Chris Bryson, Unata's Chief Executive Officer, will remain in his current role, and will report to Instacart's Chief Business Officer, Nilam Ganenthiran. The transaction is subject to customary closing conditions.
Learn more about these companies.
Instacart
Dunn’s River Brands Acquires Temple Turmeric
Givaudan Acquiring Naturex
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