PAI Partners has agreed to acquire Alphia, one of the largest pet food co-manufacturers in North America, from J.H. Whitney Capital Partners.
Alphia is a manufacturer of more than one billion pounds of dry pet food and treats annually and also provides research and development, warehousing, transportation, and distribution services. According to sources familiar with the transaction, the sale of Alphia, which had FY2022 revenues of $875 million, is at an enterprise value of $1 billion.
J.H. Whitney acquired Alphia’s predecessor, C.J. Foods, in 2014. The company’s name was changed to Alphia in June 2020 when C.J. Foods acquired family-owned pet food maker American Nutrition.
Today, Denver-based Alphia has 800 employees, operates 6 manufacturing facilities across the US, and is the parent company of LANI, a provider of ingredient milling services (acquired in 2018), and Veracity, a warehousing and logistics services provider (acquired through the merger with American Nutrition).
“We have had a great partnership with the Alphia management team,” said Bob Williams, a senior managing director at J.H. Whitney. “Through deep investment in people, systems and facilities, with a constant focus on customers, Alphia has developed into a leading and pre-eminent co-manufacturer in the pet food industry. We are proud of the team and look forward to seeing Alphia continue its successful growth with PAI.”
“We appreciate the many years of support and partnership with J.H. Whitney, during which time we created Alphia, one of the leading pet food co-manufacturing platforms in the world,” said David McLain, the CEO of Alphia. “PAI is committed to our ongoing vision for growth and shares the common values of innovation, food safety and industry leadership.”
“Alphia is a best-in-class company and plays an invaluable role in the value chain of pet food and treats, an exciting consumer category with strong secular tailwinds,” said Winston Song, a partner at PAI and the firm’s consumer lead in the United States. “Pet parents continue to seek out innovation, quality and value – Alphia has set the industry standard as the trusted partner to many leading brands and retailers. We look forward to partnering with David McLain and his mission-driven team as we continue to invest behind Alphia to grow and scale the platform.”
“We are excited to announce our investment in Alphia, which represents our second platform in the U.S. We are committed to building the PAI franchise in the U.S. and look forward to our continued growth and success in this market,” said Maud Brown, a partner at PAI and the head of PAI’s United States team. PAI’s first major acquisition in the United States was the buy of Tropicana from PepsiCo in 2021.
Paris-headquartered PAI Partners invests in business services, food, consumer, general industrials, and healthcare companies based in the United States and Europe. PAI was founded in 1994 but its origins date back to Paribas Affaires Industrielles, a private equity operating unit of Paris-headquartered BNP Paribas which was founded in 1872.
J.H. Whitney invests in small and middle-market companies that are active in the consumer, healthcare, and specialty manufacturing. The firm was founded in 1946 and is based in New Canaan, Connecticut.
Goldman Sachs was the financial adviser to Alphia on this transaction.
© 2023 Private Equity Professional | August 30, 2023
