North Castle and Glencoe Exit Flatout
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North Castle and Glencoe Exit Flatout

flatout nf1North Castle Partners and Glencoe Capital have sold Flatout – a manufacturer and marketer of flatbreads and flatbread products – to T. Marzetti Company, a subsidiary of Lancaster Colony Corporation (NASDAQ: LANC) for a price of $92 million.  North Castle and Glencoe acquired Flatout in 2010.

Lou Marinaccio nf1According to North Castle the transaction represents another successful exit in the nutrition sector. “The growth of Flatout and its sale to T. Marzetti Company is another example of North Castle’s strategy to partner with accomplished entrepreneurial management teams to build high-growth brands that are of significant value to strategic buyers,” said Lou Marinaccio, a North Castle Managing Director. “By leveraging our prior experience with nutrition and food & beverage companies, such as Naked Juice, EAS, and Atkins Nutritionals, we believe that North Castle in partnership with Flatout’s leadership team developed a company, brand, and product portfolio that are well positioned for growth for many years to come.”

Flatout is a manufacturer and marketer of flatbreads and flatbread products sold under its own brand to a diverse and multi-channel customer base.  Flatout’s annual net sales for the twelve months ended December 31, 2014 were approximately $46 million.  The company was founded in 2000 by Stacey and Mike Marsh and is headquartered west of Detroit in Saline, MI (www.flatoutbread.com).

“North Castle’s experience in the food & beverage and nutrition markets, coupled with its brand building and operating capabilities were instrumental in helping us grow Flatout,” said Stacey Marsh, Co-Founder and President. “I am excited for Flatout to be part of the T. Marzetti family as we continue to drive the growth of the brand and continue our history of innovation in the category.”

North Castle makes control investments in consumer-driven product and service companies located in North America with enterprise values ranging from $50 million to $500 million.  Sectors of interest include: beauty & personal care; consumer health; fitness, recreation & sports; home & leisure; and nutrition. North Castle is headquartered in Greenwich, CT (www.northcastlepartners.com).

“As a private equity firm that has focused on consumer businesses that promote health and wellness for more than 15 years, we continue to look for opportunities across the healthy, active and sustainable living market to leverage our knowledge, network and experience in building market leaders like Flatout,” said Mr. Marinaccio.

Glencoe Capital makes acquisitions and growth equity investments in lower-middle market companies that have EBITDAs between $3 million and $15 million. The firm has completed over 45 acquisitions, representing over $ 1.6 billion in transaction value. The firm currently manages three funds: the Glencoe Capital Michigan Opportunities Fund, Glencoe Capital Partners III, and Glencoe Capital Partners II. Founded in 1993, Glencoe Capital has offices in Chicago and in the Detroit suburb of Birmingham (www.glencap.com).

The buyer of Flatout, Lancaster Colony Corporation, is a manufacturer and marketer of specialty food products for the retail and foodservice markets and has annual revenue of approximately$1 billion. The company is headquartered in Columbus, OH (www.lancastercolony.com).

“We are very excited to add Flatout flatbreads to our specialty foods business as a better-for-you branded retail product with extraordinary taste, nutritional advantages and convenient versatility for most every eating occasion,” said Bruce Rosa, President of T. Marzetti Company.  “Since introducing their first flatbread wraps to retailers in 2000, Flatout has continued to pioneer the on-trend and growing flatbread category as consumer preferences have shifted towards more healthy living and nutritional awareness.  With placement in the supermarket deli department, Flatout’s product offerings include unique oval-shaped flatbread wraps, the successful Foldit® line of artisan flatbreads and the recently-introduced Artisan Thin pizza crust.”

Lincoln International served as financial advisor to North Castle and Flatout on this transaction.  Lincoln specializes in merger and acquisition advisory services, debt advisory services, private capital raising and restructuring advice on mid-market transactions. The firm also provides fairness opinions, valuations and pension advisory services on a range of transaction sizes. Lincoln has sixteen offices in the Americas, Asia and Europe and is headquartered in Chicago (www.lincolninternational.com).

© 2015 PEPD • Private Equity’s Leading News Magazine • 3-16-15

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