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Peterson Farms Acquires Blue Point’s Country Pure Foods

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Blue Point Capital Partners has completed the sale of Country Pure Foods, a manufacturer of juice and beverage products, to Peterson Farms which is co-owned by the Peterson family and Mubadala Capital.

Country Pure Foods was founded in 1995 by First Atlantic Capital and DN Partners through the merger of Natural Country Farms and Ohio Pure Foods, creating a specialized provider of portioned juices for the institutional market. In 1998, the company acquired Ardmore Farms, a Florida-based maker of frozen, portion-controlled juices, from Quaker Oats. In August 2010, Mistral Equity Partners acquired the business and added on with the April 2012 buy of Cal-Tex Citrus, a Texas-based maker of frozen, portion-controlled juice cups for schools and hospitals. The company temporarily exited private equity ownership in 2015 when it was sold to a Florida-based Silver Springs Citrus, a joint venture between Japanese conglomerates Sapporo International and Toyota Tsusho.

Blue Point returned the platform to private equity ownership in December 2019 when it purchased Silver Springs Citrus with equity from its fourth fund. During Blue Point’s six-year hold period, the company did not close any add-on acquisitions yet was able to triple its EBITDA through a combination of organic growth and operational improvements.

During its partnership with Blue Point, the company expanded its production capacity, optimized equipment utilization, and implemented data-driven pricing analytics.

Inside the high-volume production line at Country Pure Foods, where operational improvements are meeting increased demand in the K-12 and healthcare sectors.

Specifically, to support its growth in the K-12 education sector, the company invested in additional manufacturing capacity for its single-serve juice cups and pouches. Management simultaneously launched a new series of plant-based and aseptic products, secured new private label contracts, overhauled its equipment maintenance schedules to reduce downtime, and utilized cost data to re-price low-margin institutional contracts.

Tony Muscato
Tony Muscato

“Partnering with Blue Point has been instrumental to our growth journey as a company,” said Tony Muscato, the chief executive officer at Country Pure Foods. “Over the last six years, we’ve built meaningful value across the business while empowering our team and delivering innovative and high-quality products for our customers.”

Peterson Farms is a processor of fruit products, including apples, blueberries, and cherries. The acquisition of Country Pure Foods is part of Peterson Farms’ strategy to expand its footprint in the value-added fruit and beverage processing sector. The company is headquartered near Grand Rapids in Shelby, Michigan.

Akron-headquartered Country Pure Foods processes, packages, and distributes fruit juices, plant-based beverages, and frozen novelties. Company-owned brands include Silver Springs Citrus, Natural Country Farms, Ohio Pure Foods, Ardmore Farms, and Cal-Tex Citrus Juice. Country Pure utilizes a high-volume production model designed to serve institutional requirements in the healthcare and education sectors. For example, dietary directors at hospitals and long-term care facilities utilize the company’s pre-portioned, sealed four-ounce juice cups to ensure sanitary, consistent caloric delivery for patient meal trays.

The sale of Country Pure occurs within a substantial domestic market for beverages. According to Grand View Research, the U.S. fruit and vegetable juice market was valued at approximately $86 billion in 2024. Growth in the sector is being driven by increasing consumer demand for convenient, nutrient-rich beverages and a shift toward plant-based diets, with institutional food service remaining a critical distribution channel for portion-controlled products. This institutional demand is further bolstered by a surge in private label adoption.

Jonathan Pressnell
Jonathan Pressnell

“From the outset, Country Pure Foods had an impressive foundation with a clear growth vision,” said Jonathan Pressnell, a partner at Blue Point. “Our collaboration unlocked meaningful opportunities, and the progress achieved truly reflects the talent and dedication of the entire team.”

Blue Point invests in companies active in the industrial, business services, consumer, and value-added distribution sectors, with revenues between $30 million and $300 million and EBITDA greater than $7 million. Blue Point is currently investing through its 2022 vintage $700 million fifth fund. The firm was founded in 2000 and has offices in Cleveland, Charlotte, Seattle, and Shanghai.

Mubadala Capital is an active investor with a specific interest in the consumer and food services sectors. The firm has more than $20 billion in assets under management including four flagship private equity funds, three early-stage venture funds, two funds in Brazil focused on special opportunities, an evergreen investment strategy focused on private market opportunities, as well as a series of co-investment and special purpose vehicles, and continuation funds. Mubadala Capital is a subsidiary of Abu Dhabi-headquartered Mubadala Investment Company, a $280 billion sovereign investor. The firm has offices in New York, San Francisco, London, Rio de Janeiro, and Abu Dhabi.

William Blair was the financial advisor to Country Pure Foods and BakerHostetler provided legal services.

Balmoral Exits Resco with Sale to RHI Magnesita

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Resco Products, a portfolio company of Balmoral Funds, has agreed to be acquired by RHI Magnesita at an enterprise value of $430 million. Balmoral acquired Resco in March 2022 from Wellspring Capital Management.

Resco Products is a make of refractory products including bricks, monolithics, pre-cast shapes, cartops, clays and minerals that are used in the steel, aluminum, paper, power, cement, and other industrial end markets.

Source: RHI Magnesita

Refractory products are used in high-temperature industrial processes – greater than 1200 °C – to contain materials while they’re burned, melted, blasted, fired, fused, and shaped; and to protect equipment such as furnaces and kilns against thermal, mechanical and chemical stress.

Pittsburgh-headquartered Resco was founded in 1946 as Refractory Specialties Co. and today, led by CEO Mark Essig, operates 11 facilities across North America and the United Kingdom.

Vienna, Austria-headquartered RHI Magnesita (LSE: RHIM) is a supplier of high-grade refractory products and systems that are used in high-temperature processes in a range of industries, including steel, cement, non-ferrous metals and glass.

RHIM manufactures more than 120,000 products that include bricks and lining mixes to flow control products such as slide gates, nozzles and plugs. RHIM products, which can have service lives from a few cycles within a day to as long as 10 years, are made from base materials including magnesite and dolomite.

Source: RHI Magnesita

According to RHIM, which was founded in 1834, the company is a leader in the refractories sector with more than 16,000 employees at 47 production sites, 8 recycling facilities and more than 70 sales offices.

“We are grateful to Mark Essig, Chairman of the Board Dr. Kevin Handerhan and the entire Resco team for their terrific partnership over the past two years,” said Robin Nourmand, a managing director at Balmoral. “Working together, we significantly improved Resco’s operations, ultimately transforming the business and realizing a successful outcome for this investment.”

Los Angeles-headquartered Balmoral invests in corporate carve-outs, restructurings and other special situations. The firm targets equity investments of $20 to $125 million in companies with $30 million to $400 million in revenues.

Jefferies is the financial advisor to Resco on this transaction which is expected to close in the second half of 2024.

© 2024 Private Equity Professional | April 4, 2024

Something Great

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The last week in May, I had two reasons to think of my stepfather. It was Memorial Day, and I had surgery on my left wrist.

In November 1944, Almarin Phillips was a 19-year-old soldier whose unit was liberating territory in northern France. The vicious and decisive Battle of the Bulge was a month away. A German bullet shattered Al’s left arm.

He lost the arm, came home, and spent a year in an Army hospital doing rehab. Al led a productive, admirable life up to his passing in 2006.

A few days after Memorial Day, I had surgery to clean up my balky wrist. My left hand was immobile for about a week afterward. It would have been within the bounds of the sense of humor Al and I shared for me to have called him to complain that opening a pickle jar with one hand is kind of difficult.

Al had such facility with one arm that it was easy to forget his infirmity day-to-day. I’ll never forget, though, the habits he learned in that Army hospital and practiced for the next 60 years. The way he tied his shoes. How he cut meat by pressing down hard on the knife with his forefinger. His wobbly but determined crawl stroke in the pool.

Al became an economist. He spent most of his career at the University of Pennsylvania. He got his start as a disciple of the German-Austrian economist Joseph Schumpeter and his principle of “creative destruction.” One of the defining ideas of capitalism in the 20th century,  creative destruction “refers to the incessant product and process innovation mechanism by which new production units replace outdated ones.”

In other words, government intervention to weaken market leaders or to protect failing business models is almost always unwise. There will always be a better idea. What if government acted in 1950 to protect movie houses against broadcast television? We might not have had cable television. Worried in 1970 that TV would be limit access to movies in the home? Maybe no video cassettes. Blockbuster led to Redbox, which led to Netflix, which led back to cable, which led to multiple streaming services.

This was the talk of our dinner table. I took away a conviction that free market capitalism was not perfect, merely indispensable.

For the past year, my friend Charlie Gifford and I have been doing a podcast called Middle Market Musings. Most of our guests are leaders in private company M&A – principals in private equity funds and investment banks.

We talk about their achievements, but also about the world at large and how our economic system can work better for more people. Invariably, there are stories about how they became connected to a system with a beating heart.

Our most recent guest was Tarrus Richardson, the founder and CEO of IMB Partners in suburban Washington. Tarrus grew up in a family business in Chicago – a bar his parents bought so their children would have an entrepreneurial experience. Tarrus worked in the bar after school. At night, he’d sleep when the music was playing so he could study when the music was off.

Before that, Chris Williams, the co-founder of the Harris Williams investment bank, came in. We asked him what it was like to work with his mentor, the legendary Erskine Bowles. I thought Chris would tell us about a big pitch or defining deal. Instead, he told us about Bowles finding him in the office on a Sunday. Bowles said he knew Chris’s faith was important to him, and that if he had that much work, he needed to speak up. He didn’t want Chris to be missing church to be in the office.

The men and women who fight for this country are defending a lot of things, but I believe that includes this way of life.

The week before Memorial Day, we line our property with small American flags. They stay up through D-Day and Flag Day and now Juneteenth, finally coming down after July 4th.

Every few days a flag gets knocked out of place. We never fix them. Within a day, somebody – a runner, a dog walker – sets the errant flag straight.

I’m happy to share with them the way it feels to be a part of something great.

About the Author
Andy Greenberg is CEO of Greenberg Variations Capital, a mergers & acquisitions advisory firm based in suburban Philadelphia devoted to one-off or targeted transactions. He is also Founder of GF Data© (now an ACG Company) the leading provider of information on private transactions in the $10 million to $500 million value range. For more information, visit www.greenbergvariations.com or www.gfdata.com.

© 2022 Private Equity Professional | June 28, 2022

The Whirlaway Market

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Like a sprinting racehorse maintaining its stride on the last turn, middle-market M&A kept its pace as 2021 drew to the finish, according to GF Data’s just-released February report. Valuations in the fourth quarter averaged 7.5x, matching the elevated mark for Q3.

GF Data’s 258 active private equity contributors reported on 151 transactions in the quarter meeting our parameters – Total Enterprise Value (TEV) of $10 million to $250 million and TEV/Trailing Twelve Months (TTM) Adjusted EBITDA of 3x to 15x. This outdistanced the 135 transactions reported in Q4 2020 when the market was coming to life after two pandemic-shocked quarters.

“The most notable thing about this market is that there appears to remain some room for pricing to advance,” said Andrew Greenberg, CEO of GF Data. “While valuations held steady in the fourth quarter, average debt loads also increased, dropping average equity shares to about 52 percent. This suggests headroom — particularly on sub-$50-million deals, where the figure is a few points lower.”

“The fourth quarter continued a trend of an unusually high percentage of deals meeting our metrics for “above-average” financial performance,” said B. Graeme Frazier, a co-founder and principal of GF Data. “The selling businesses designated as above-average based on TTM EBITDA margin and revenue growth were valued at a 30 percent premium to others in 2021, continuing an upward trend of the past five years. However, the incidence of deals meeting this standard – almost always 56% to 57% – surged to 66% for the year.”

“The M&A market, in general, continues to be competitive for buyers,” said Justin Hillenbrand, a founding partner and co-CEO of Monomoy Capital Partners. “We look for situations where Monomoy is able to differentiate itself and can add unique value through our operating team’s capabilities. Having recently completed fundraising on Fund IV with over $1.1 billion in commitments, we are thrilled that GF Data has expanded its parameters to include deals with $250 million to $500 million in enterprise value.”

GF Data provides reliable external information for use in valuing and assessing M&A transactions to private equity firms, investors, lenders, and other users. The firm collects and publishes proprietary transaction information from private equity groups on a blind and confidential basis. The pool of active contributors comprises 258 private equity firms, mezzanine groups, and other financial sponsors.

Data contributors and other subscribers receive five products: (1) a quarterly report containing high-level valuation, volume and leverage data; (2) a quarterly supplement offering detailed information on debt and capital structure trends; (3) a semi-annual supplement on indemnification cap, escrow and other details; (4) quarterly industry drilldown reports; and (5) continuous access, through GF Data’s secure website, to detailed valuation data organized by NAICS code.

For information on subscribing or on contributing data as a private equity participant, please contact Bob Wegbreit at [email protected] or 610-616-4607.

© 2022 Private Equity Professional | February 17, 2022

Cirque du Soleil Gets Stalking Horse

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In response to the disruption and forced show closures as a result of the COVID-19 pandemic, Cirque du Soleil Entertainment Group has filed for protection from creditors in Canada – under the Companies’ Creditors Arrangement Act and will seek protection in the United States under Chapter 15 of the US Bankruptcy Code.

Cirque du Soleil (“Circus of the Sun”) is a Canadian entertainment company and one of the largest theatrical producers in the world. Annual revenues – during normal times – are estimated at more than US$800 million. Cirque was founded in 1984 by two former street performers, Guy Laliberté and Gilles Ste-Croix, and is headquartered in Montreal.

Cirque was acquired by TPG and Fosun, a Chinese investment group, and Caisse de dépôt et placement du Québec (CDPQ), a Canadian manager of public pension plans, in April 2015.

Cirque has entered into a “stalking horse” purchase agreement with TPG, Fosun, and CDPQ, as well as Investissement Québec, a Montreal-headquartered business development organization that provides advisory and capital (loans, loan guarantees and equity investments) to companies looking to initiate or expand their activities in Quebec.

Under the stalking horse agreement, TPG, Fosun, and CDPQ would acquire Cirque for US$300 million through a combination of cash, debt, and equity. As part of the US$300 million, Investissement Québec will provide US$200 million in debt financing to support the proposed acquisition. Cirque’s existing secured creditors will receive US$50 million of unsecured, takeback debt in addition to a 45 percent equity stake in the restructured company.

“For the past 36 years, Cirque du Soleil has been a highly successful and profitable organization. However, with zero revenues since the forced closure of all our shows due to COVID-19, management had to act decisively to protect the company’s future,” said Daniel Lamarre, the president and CEO of Cirque. “The agreement provides a path for Cirque to emerge from bankruptcy protection as a stronger company. I look forward to rebuilding our operations and coming together to once again create the magical spectacle that is Cirque du Soleil for our millions of fans worldwide.”

As a part of its restructuring and plan to restart operations, Cirque will terminate approximately 3,500 employees previously furloughed in March following the halt in revenue caused by COVID-19 government-mandated shutdowns. This action allows employees to maximize compensation that they can obtain from the Canadian Federal Wage Earners Protection Program and other unemployment assistance programs. Certain staff active with Cirque’s Las Vegas and Orlando shows – which will restart sooner than other company’s shows – are not among the terminated employees.

TPG was founded in 1992 and makes investments throughout North America, Europe, Asia, and Australia.  Sectors of interest include industrials, retail, consumer, financial services, travel and entertainment, technology, media and communications, and healthcare.

Fosun, publicly traded on the Hong Kong stock exchange, is a Chinese conglomerate with international investments in healthcare, tourism, fashion firms and banks.  Fosun was founded in 1992 and is headquartered in Shanghai, China.

Caisse de dépôt et placement du Québec is an institutional investor that manages funds primarily for public and para-public pension and insurance plans. As of December 2019, it held C$340 billion in net assets.

Cirque is being advised by Montreal-based Stikeman Elliott, Chicago-based Kirkland & Ellis, Montreal-based National Bank Financial and New York City-based Greenhill & Co.

Private Equity Professional | July 1, 2020

Sole Source Adds Grocery Box

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Sole Source Capital’s portfolio company Worldwide Produce (WWP), a distributor of fresh produce, dairy and specialty foods in California and Nevada, has expanded its product line by creating the Worldwide Grocery Box, an assortment of regionally-sourced produce, dairy, eggs and specialty foods.

The Worldwide Grocery Box product is offered in two versions – a fresh produce box or a fresh produce, dairy and eggs box – and is delivered on-demand by Postmates, a San Francisco-based online delivery service, to customers throughout Los Angeles, enabling shoppers to avoid busy grocery stores and empty shelves.

“WWP is thrilled to extend our seasonal produce, dairy and specialty offerings directly to those in need of fresh food through Postmates’ e-commerce and on-demand delivery app,” said Abbas Ghulam, co-founder and CEO of Worldwide Produce. “WWP is committed to the highest standards of safety in sourcing, handling and storing of all produce, and we are now pleased to provide our customers with a tailored box of fresh foods with the click of a button.”

“The Worldwide Grocery Box provides a creative solution to supplying high-quality, fresh groceries to the elderly, sick and quarantined families during this unprecedented time and is a prime example of how Sole Source looks to help its companies adapt their business models and broaden capabilities in times of crisis,” said David Fredston, managing partner at Sole Source. “We thank our valued employees at WWP for remaining focused on delivering boxes of healthy ingredients to communities across Los Angeles and are pleased to know that we are offering a direct-to-door solution to those who are unable or hesitant to go shopping.”

Sole Source acquired Los Angeles-based WWP in October 2019. The company is one of the largest produce and dairy distributors in Southern California with more than 6,000 SKUs of fresh fruits, vegetables, eggs, dairy, cheese, dry goods, oils, spices, frozen and processed products, flowers and other specialty food products. WWP operates out of two distribution facilities located in Los Angeles (150,000 sq. ft.) and Las Vegas (17,000 sq. ft.) and has a fleet of over 70 delivery vehicles.

Santa Monica-based Sole Source Capital makes control investments in high precision manufacturing, diversified distribution, and industrial service companies that have at least $50 million of revenue and $5 million of EBITDA. Sole Source was founded in 2016 and in November 2018 the firm closed its inaugural funds, SSC Partners I LP and SSC Partners I-A LP, at a combined hard cap of $160 million.

© 2020 Private Equity Professional | March 24, 2020