Kronos Foods, a portfolio company of Entrepreneurial Equity Partners (E2P), has merged with Grecian Delight Foods. The combined businesses will continue to go to market under their existing brands but will operate under a new platform called World Foods which is majority-owned by E2P.
Grecian Delight is a manufacturer and marketer of Mediterranean cuisine including gyros and specialty meats, pitas and flatbreads, tzatziki, hummus, and falafel. The company’s products are sold to customers operating in the foodservice and retail sectors.
Grecian Delight was founded in 1974 by Peter Parthenis, Sr. and is today led by his son, Peter Parthenis, Jr. The company is headquartered near Chicago in Elk Grove Village and has annual revenues of approximately $140 million.
The Parthenis family will maintain a significant equity stake in the merged businesses and Peter Parthenis will serve as the chief executive officer of the combined company. “This is a partnership that has been thirty years in the making. Now, two great organizations are coming together with a unified goal of putting our customers in a better position to succeed by delivering even more value-added products and services,” said Peter Parthenis, Jr.
E2P acquired Kronos Foods, a manufacturer and distributor of Mediterranean food products, from Grey Mountain Partners in February 2020. Kronos’ products include gyros meat, pitas and flatbreads, hummus, sauces, and desserts primarily under the Kronos and Sinbad Sweets brands. The company also produces custom products for quick service retail, fast-casual, and family dining restaurant chains.
Founded in 1975, Kronos began as a small seller in Chicago’s Fulton Street Market but has grown to be a leading manufacturer of Mediterranean and other premium foods, with distribution nationwide through foodservice channels and major retailers, including broadline and specialty distributors, club stores, mass merchants and grocery chains. Kronos, with annual revenues of approximately $170 million, has more than 270 employees and is based in the Chicago suburb of Glendale Heights.
“This merger will allow Grecian Delight and Kronos to accelerate growth into global cuisine and protein-based foods – both significant trends within the food sector,” said Mark Burgett, a managing partner of E2P. “We are excited to leverage our extensive network and experience in the food sector to support growth and introduce new product offerings.”
Kronos, now renamed World Foods, is the third platform investment for E2P’s inaugural fund, Entrepreneurial Equity Partners Fund I LP, and it follows the platform buys of Sara Lee Frozen Bakery, a maker of frozen bakery and dessert products headquartered in the Chicago suburb of Oakbrook Terrace (acquired in July 2018 in partnership with Kohlberg & Company); and Daniele International, a Rhode Island-based maker of branded and private label specialty meats (acquired in September 2019). In addition to these three platforms, E2P has also closed four add-ons acquisitions with the buys of Superior Cake Products and Cyrus O’Leary’s Pies (by Sara Lee Frozen Bakery), Creminelli Fine Meats (by Daniele International), and Grecian Delight Foods (by Kronos).
Chicago-based E2P was founded by Mr. Burgett, a former managing director at Wind Point Partners, and CJ Fraleigh, a former CEO of Shearer’s Foods and Sara Lee North America. The firm makes control-oriented investments of $25 million to $150 million in companies that have revenues of at least $50 million and are active in the food and consumer packaged goods industries. Sectors of specific interest include established food and beverage products and brands, private label and contract manufacturing.
Joining the board of directors of World Foods will be food industry veteran Rich Scalise. Mr. Scalise has served on the board of Grecian Delight for more than a decade and is the former CEO and current chairman of the board of Hearthside Food Solutions, a contract manufacturer of food products and the largest private bakery in the US. Hearthside was formed by Wind Point Partners and Mr. Scalise in 2009 with Mr. Burgett – then a managing director at Wind Point – leading the transaction. Wind Point sold Hearthside to Goldman Sachs and Vestar Capital Partners in 2014. Later, in 2018, it was sold to Charlesbank Capital Partners and Partners Group.
Financing for the merger of Kronos and Grecian Delight was provided by BMO Capital Markets, Compeer Financial, Greenstone and AgCountry. “Without the support of this amazing bank group we wouldn’t have been able to close the transaction given the recent market turmoil. They were truly great partners throughout the deal process,” said Mr. Burgett.
©2020 Private Equity Professional | April 8, 2020