AUA Private Equity has closed the sale of Water Lilies Food, a manufacturer of Asian-inspired food products, to Blue Point Capital Partners.
Water Lilies is a manufacturer of Asian appetizers and entrees including frozen egg rolls, spring rolls, potstickers, dumplings, and a variety of noodle products with vegetarian, meat, natural, organic, and gluten-free options. The company’s customers include major retail private label and foodservice customers nationwide.
Water Lilies, led by second-generation family member and CEO Peter Lee, was founded in 1995 in a 6,000 sq. ft. kitchen in Brooklyn and today operates an SQF Level 3 and USDA organic certified 200,000 square foot facility with 400 employees and 7 production lines on Long Island in Bay Shore, New York.
AUA acquired family-owned Water Lilies in December 2017 in partnership with the founding Lee family. During its investment term, AUA assisted the company in tripling its manufacturing footprint by relocating its Astoria, New York facility (48,000 sq. ft.) to the new Bay Shore facility. Under AUA’s ownership, Water Lilies’ revenues and EBITDA grew organically by more than 3x.
The AUA transaction team was led by Partner David Benyaminy, Senior Associate Nicolas Pflaum, and Analyst Trip Ewig. “From the beginning, we shared a vision with Peter to create a leading national Asian appetizer manufacturer driven by a relentless focus on innovation, quality and service,” said Mr. Benyaminy. “We are pleased to announce the sale of Water Lilies to Blue Point who we believe will be a great partner to the Lee family and the company as it embarks on its next phase of growth.”
“I cannot speak highly enough of the partnership with AUA Private Equity and the value they created for Water Lilies through its active sponsorship,” said Mr. Lee. “From helping us build a phenomenal management team to supporting prudent operational initiatives, including our facility expansion, AUA’s support ultimately led to a great result for our management team, owners, and investors.”
Blue Point invested in Water Lilies in partnership with Mr. Lee who is retaining a significant ownership position in the company. “We are delighted to partner with Peter and the experienced team at Water Lilies. They have built an excellent business that is well-aligned with our operating resources, industry experience, and history of impactful partnerships with family and founder-led businesses,” said John LeMay, a partner at Blue Point.
Post-closing, Blue Point operating executives, Angelo Fraggos and Clarence Mou, will join the Water Lillies’ board of directors and will provide strategic advice to the company’s management team. Mr. Mou and Mr. Fraggos have decades of food manufacturing experience including direct involvement in the frozen Asian appetizer category with Mr. Mou’s prior family business, Discovery Foods.
Blue Point invests in companies that are active in the industrial, business services, consumer, and value-added distribution sectors and have from $30 million to $300 million in revenue and EBITDA greater than $7 million. The firm has offices in Cleveland, Charlotte, Seattle, and Shanghai.
AUA Private Equity makes equity investments from $20 million to $75 million in companies with at least $5 million of EBITDA. Sectors of interest include consumer products and services with a focus on family-owned and Hispanic-oriented businesses. AUA is known for using low leverage to acquire companies and focusing on operational improvements rather than financial engineering to create stakeholder value. In May 2021, AUA held a final and oversubscribed closing of AUA Private Equity Fund II LP with total capital commitments of $310 million. New York City-based AUA was founded in 2011.
“Water Lilies represents the core of AUA Private Equity’s investment strategy – partnering with great family business owners in the consumer sector and building an institutional foundation for accelerated growth and sustainable profitability,” said Andy Unanue, the managing partner of AUA. “We are extremely pleased to celebrate Water Lilies’ success and are excited for the Lee family and company’s next chapter.”
Harris Williams was the financial advisor to AUA on this transaction. Tim Alexander, Brant Cash, Brant Wilczek, Hannah Cho, and John Cunningham of the Harris Williams consumer group led the transaction.
Baker Hostetler provided legal services to Blue Point on this transaction and Stout provided financial due diligence services.
© 2022 Private Equity Professional | September 9, 2022
