Brynwood Adds Brands to Hometown Food

Hometown Food Company, a portfolio company of Brynwood Partners, has acquired the Arrowhead Mills and SunSpire brands from The Hain Celestial Group for $15 million.

Arrowhead Mills competes primarily in the organic baking and breakfast categories and its product portfolio includes baking and dessert mixes; beans, grains, and seeds; cold and hot cereals; flours; and pancakes and waffle mixes. The brand was founded in 1960 in Texas by Frank Ford, a pioneer in organic farming, and acquired by Hain Celestial in 1999.

SunSpire is a producer of baking chocolate and chocolate candy. The brand’s baking chips and chocolate bars include fair trade, organic and alternative products that are free of refined sugars, hydrogenated oils, trans-fats, preservatives and artificial flavors. The brand was founded in 1979 by Janet Jennings, a fourth-generation chocolatier. SunSpire was acquired in 1999 by nSpired Natural Foods which in turn was acquired by Hain Celestial in 2008.

The buy of the Arrowhead Mills and SunSpire brands includes a manufacturing facility located near Amarillo in Hereford, TX.

“We are delighted to announce the acquisition of the Arrowhead Mills and SunSpire brands into Hometown Foods,” said Henk Hartong, chairman and CEO of Brynwood Partners. “Arrowhead Mills and SunSpire were pioneers in the organic, non-GMO ingredients space and we are excited to add these tremendous brands to our portfolio. This acquisition strengthens our industry position by adding improved capabilities in the better-for-you space that we plan to extend into our other categories.”

Brynwood formed Chicago-based Hometown Food in June 2018 to acquire a portfolio of food brands, with total annual revenues estimated at $200 million, from The J.M. Smucker Company for approximately $375 million. This transaction included the acquisition of a 650,000-square-foot manufacturing facility in Toledo, OH with 255 full-time employees.

The acquired Smucker’ brands included the exclusive US rights to Pillsbury’s shelf-stable baking products, including Funfetti, along with the Hungry Jack, White Lily, Jim Dandy and Martha White brands.

Funfetti and Hungry Jack are leading national brands in the shelf-stable baking and breakfast categories and White Lily, Jim Dandy and Martha White are regional brands known for flour, cornmeal and grits. Brynwood owns Hometown Food through investments from both its seventh and eight funds.

The Hain Celestial Group (NASDAQ: HAIN) is a provider of foods and personal care products including herbal teas, whole-grain foods, and protein products. The company was founded in 1993 and is headquartered on Long Island in Lake Success, NY (www.hain-celestial.com). Hain Celestial has been an active seller in 2019 as it looks to improve profitability by divesting some of its lower-margin and lower-growth brands.

In June 2019, Hain Celestial sold Hain Pure Protein, comprised of Mifflintown, PA-based Empire Kosher (fresh kosher poultry) and Fredericksburg, PA-based FreeBird (organic and antibiotic-free chicken ), to Aterian Investment Partners in an $80 million carve-out transaction.

Brynwood is an operationally-focused firm that makes control investments in North American-based lower middle-market companies. The firm targets non-core brands or companies operating exclusively in the consumer sector. Since its founding in 1984, Brynwood has acquired more than 50 brands from 20 different corporate sellers. In January 2018, the firm held a final close of its latest fund, Brynwood Partners VIII LP, with $649 million of committed capital. Brynwood currently has $1.1 billion of total capital under management and is based in Greenwich, CT (www.brynwoodpartners.com).

© 2019 Private Equity Professional | October 8, 2019

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