Brynwood Partners has signed an agreement to acquire a controlling stake in the Back to Nature brand food business through a joint venture partnership with Kraft Foods. Kraft Foods will continue to hold a substantial minority stake in the business and will have board representation in the joint venture that is to be formed. The transaction is scheduled to close in October.
“This deal has a unique structure where a large consumer company like Kraft Foods has identified a way to partner with a specialist like Brynwood Partners to increase growth of a non-core asset while maintaining a significant financial interest,” said Henk Hartong III, Senior Managing Partner of Brynwood. “We think that this is a very forward-looking concept, and we are delighted to be Kraft’s partner.”
The Back to Nature joint venture will initially offer products in four categories: (i) crackers, (ii) cookies, (iii) trail mixes & nuts and (iv) granola, while management of the Back to Nature macaroni and cheese business will remain with Kraft Foods. Back to Nature products are distributed in the United States through retailers in the natural, food, drug, mass and club channels. Founded in 1960, Back to Nature is based in Madison, WI (www.backtonaturefoods.com).
As part of the transaction, Brynwood will appoint Vincent Fantegrossi as President and CEO of the new company. Mr. Fantegrossi previously served as President and CEO of Richelieu Foods, a Brynwood investment that returned over six times total invested capital and generated a gross internal rate of return of over 40%. Under Brynwood’s ownership, Richelieu’s sales grew from $100 million to over $250 million.
Brynwood Partners is an operationally-focused private equity fund that makes control investments in lower middle market companies. Sectors of interest include consumer products, light manufacturing with low capital intensity and business services. Brynwood Partners has $500 million of capital under management. The firm was founded in 1984 and is based in Greenwich, CT (www.brynwoodpartners.com).