Kainos Capital has sold its portfolio company SlimFast to Glanbia plc in a transaction valued at $350 million. The transaction also includes SlimFast’s sister company, HNS.
SlimFast is a provider of meal replacement beverages and snacks with a specific focus on weight management and health and wellness products. The company’s products – which include shakes, bars, snacks, and packaged meals – are sold in the US, Canada, France, Germany, Iceland, Ireland, Latin America, and the UK. SlimFast, led by CEO Chris Tisi, is headquartered in Palm Beach Gardens, FL (www.slimfast.com).
Kainos acquired SlimFast from Unilever in July 2014 and simultaneously acquired Hyper Network Solutions (HNS), a distributor of SlimFast products led by Mr. Tisi.
“Our acquisition of SlimFast came with no employees or systems,” said Andrew Rosen, Managing Partner of Kainos. “Behind the leadership of CEO Chris Tisi, who we partnered with when we invested in his company HNS in 2014, we quickly built a 60-plus person team in the US and the UK. This team, combined with our own internal resources, did a great job revitalizing what was an orphan brand within a large multinational company. SlimFast is positioned to continue its great success as a part of Glanbia.”
In 2017, SlimFast had $212 million of revenue and adjusted EBITDA of $24 million. With a purchase price of $350 million, this results in purchase price multiple of 14.6x.
“Chris led our very talented team in the development of a comprehensive game plan for restoring SlimFast to its former success,” said Bob Sperry, a Partner of Kainos. “This included redesigning the packaging across the product range and leveraging the great clinical studies that demonstrate the effectiveness of its products. We also relaunched advertising campaigns that resonated with our consumers and supported innovative new product platforms. The result was a dramatic turnaround in the sales trajectory such that for the last three years SlimFast was the fastest-growing brand in the weight management category in the US and the largest brand in the UK.”
Kainos Capital invests from $50 million to $150 million of equity in manufacturers and marketers of food products, as well as other consumer products in the household and personal care industries, and over-the-counter health and nutritional products sectors. In November 2016, Kainos closed Kainos Capital Partners II LP with total equity commitments of $895 million. The new fund was oversubscribed and closed at its hard cap. Kainos was founded in January 2012 and is based in Dallas (www.kainoscapital.com).
Publicly-traded Glanbia (LSE: GLB), the buyer of SlimFast, is a global nutrition company with operations in 32 countries. The company has leading market positions in sports nutrition, cheese, dairy ingredients, specialty non-dairy ingredients and vitamin and mineral premixes. Glanbia is headquartered in Kilkenny, Ireland (www.glanbia.com).
Harris Williams and Sawaya Partners were the financial advisors to SlimFast.
The sale of SlimFast to Glanbia is expected to close by the end of 2018.
© 2018 Private Equity Professional | October 11, 2018
