NCN News for October 6, 2017

Givaudan partners with Draco, acquires Centroflora Nutra

Flavors and fragrances giant Givaudan (Vernier, Switzerland) has made two announcements in line with its 2020 strategy to strengthen the company’s global offering of natural extracts. In October Givaudan announced a strategic partnership with herbal extract supplier Draco Natural Products Inc. (San Jose, Calif.) to develop a proprietary line of bioactive botanical ingredients for its Active Beauty business, using the principles of traditional Chinese medicine. In September Givaudan announced it is acquiring the Nutrition Division of Centroflora Group in Brazil. Centroflora Nutra manufactures botanical extracts and dehydrated fruits for the food, beverage and consumer goods sectors. Terms were not disclosed, but Centroflora Nutra’s business would have represented approximately CHF 17 million of incremental sales to Givaudan’s results in 2017 on a pro-forma basis. Centroflora’s sustainability management program was cited as one of the benefits of the deal. Givaudan, which posted sales of CHF 4.7 billion in 2016, is an NCN Cornerstone Investor.

Coca-Cola’s venture arm acquires Topo Chico sparkling water

Coca-Cola North America (Atlanta, Ga.) has added Topo Chico sparkling mineral water to its Venturing & Emerging Brands (VEB) portfolio. Arca Continental (Monterrey, Mexico), the second-largest Coca-Cola bottler in Latin America, announced the transfer of rights to Topo Chico in the United States to Coca-Cola for $220 million. The brand is currently sold in Northern Mexico and 35 states across the United States, with approximately 70% of U.S. sales in Texas. The retro-styled mineral water has been sourced and bottled in Monterrey since 1895; its customer base includes Hispanic consumers in the U.S. and Mexico and a growing Millennial following. “Our goal now is to extend its reach while preserving its heritage,” said VEB’s Matt Hughes, vice president of emerging brands and incubation, who described the beverage as “more of a lifestyle brand than a hydration brand.” Coca Cola’s other water brands include Dasani and Glacéau Vitaminwater. Coca-Cola’s VEB unit is an NCN Cornerstone Investor.

Natural Products Canada invests in Mazza Innovation

Natural Products Canada (NPC, Charlottetown, PE), a not-for-profit entity that streamlines commercialization of natural products, has invested in Mazza Innovation Ltd. (Vancouver, BC) and its PhytoClean extraction technology. NPC was one of several institutional and individual investors in Mazza’s $3-million financing round. Mazza’s technology concentrates bioactives by pressurizing water at moderate temperatures, providing better yields and higher purities than industrial solvents. “Demand for Mazza’s botanical ingredients requires us to more than double our production capacity,” said Mazza Innovation’s CEO Benjamin Lightburn. New funds will be used for a second extractor processing unit and for key hires. In addition to supplying an extraction service to the supplement industry, Mazza Innovation plans to launch proprietary ingredients.

Unilever to acquire Mãe Terra

Unilever (London and Rotterdam) is to acquire Mãe Terra (Osasco, Brazil), a brand of natural and organic food products, for an undisclosed amount. Founded in 1979, Mãe Terra operates in several categories, including organic cereals, cookies, snacks and culinary products. Mãe Terra’s main categories represent a Brazilian market worth more than €8 billion, according to Euromonitor research cited by Unilever. Mãe Terra, which has 300 employees and is growing at more than 30% per year, fits Unilever’s sustainable nutrition strategy, Unilever said, pointing out that Brazil is the fifth largest market in the world for healthy food and beverages, with 79% of consumers regarding health and nutrition as priorities. Alexandre Borges, CEO of Mãe Terra, will stay on as general manager. In September Unilever bought the organic tea brand Pukka Herbs. Unilever is an NCN Cornerstone Investor.

Factory LLC partners with Mikey’s gluten-free bakery

Factory LLC will make an initial investment of $5 million in two tranches in the better-for-you baked goods company Mikey’s (Scottsdale, Ariz.). Mikey’s offers English muffins, bread, pizza crust, tortillas and other items that are certified gluten free, in addition to having attributes like certified paleo, grain free, dairy free, soy free, peanut free, non-GMO, diabetic friendly, vegan and Kosher. “Eating gluten free is critical for people with celiac disease, and valued by many people as a lifestyle choice,” said Michael Tierney, founder and CEO of Mikey’s. “I started Mikey’s to meet the growing demand for baked goods that offer more than gluten free: unparalleled nutrition with superior taste.” Mikey’s will relocate to take full advantage of its partnership with Factory. This is Mikey’s largest round of funding since its 2014 launch. Factory is led by entrepreneurs who created $3 billion in enterprise value in three businesses: American Italian Pasta Company, The Meow Mix Company and Freshpet. Factory LLC is an NCN Cornerstone Investor.

SC Johnson to acquire Method and Ecover eco-friendly cleaning brands

SC Johnson & Son Inc. (Racine, Wis.), maker of Glade, Pledge and Windex, has agreed to purchase the Method and Ecover brands of sustainable, eco-friendly cleaning products from People Against Dirty. Ecover was founded in Belgium in 1979, and in 2012 bought Method Products (San Francisco, Calif.), a maker of biodegradable natural cleaning supplies, from San Francisco Equity Partners. SC Johnson already owns the Caldrea and Mrs. Meyers Clean Day brands, which it purchased in 2008. Terms of the pending acquisition by SC Johnson were not released. However, in September 2016, Unilever purchased Seventh Generation, a competitor in the market for green cleaning supplies and laundry detergent, for a reported $600-$700 million. Other eco cleaning brands include Earth Friendly, Biokleen, Planet, Faith in Nature, Simple Green, ECOs, Greenworks and Puracy.

Conagra to acquire Angie’s Artisan Treats

Conagra Brands Inc. (Chicago, Ill.) has announced an agreement to acquire Angie’s Artisan Treats LLC (North Mankato, Minn.), maker of Angie’s Boomchickapop ready-to-eat whole grain popcorn, from TPG Growth. Financial terms were later reported at $250 million, and Conagra expects the kettle corn brand to generate about $100 million in net sales in 2017. Sean Connolly, president and CEO of Conagra Brands, described the acquisition as “another important step in our ongoing plan to modernize our portfolio and accelerate growth.” Boomchickapop was founded by husband and wife entrepreneurs Dan and Angie Bastian in 2001; the brand features more than a dozen popcorn flavors and is available nationwide in natural food, grocery, club, drug and mass retail outlets. Angie’s was a presenting company at NCN XIII in 2013.

Nightly app for sleep problems raises Series A

DreamJay (San Francisco and Warsaw, Poland), a startup developing a digital app called Nightly to remedy sleep problems, has raised $2.3 million in a Series A funding from the Joint Polish Investment Fund (JPIF), with participation from Nordic Makers and private investors. Nightly detects onset of restlessness or bad dreams and uses audio and video content to help maintain undisturbed sleep. The company cites results showing that Nightly reduces the amount of nightmares in more than 85% of cases. According to the Nightly website, epidemiological studies show that about 30% of the world’s population suffers from sleep disorders, with one third of these cases being chronic insomnia.

Seven Sundays raises capital from Katjesgreenfood

Seven Sundays, a fast-growing muesli brand in the U.S., received a growth capital investment from Katjesgreenfood (part of Katjes Group), based in Berlin, Germany. The investment will be used to expand distribution of the brand, which is currently sold in approximately 4,000 stores including Target, Costco, Safeway, Whole Foods, Stop & Shop and Sprouts. The company has doubled sales each year since it first received capital from friends and family in 2014 after picking up distribution in Target stores across the country.

Albertsons Cos. (Boise, Idaho) has acquired the meal kit company Plated (New York, N.Y.)

With the goal of developing “the first omnichannel meal kit offering with national scale.” Albertsons will enable Plated to expand beyond its existing subscription model by offering meal kits at stores, across digital channels, and via other distribution options. Plated’s marketing and acquisition efforts will also benefit from exposure to Albertson’s 35 million customers per week. Plated will continue to operate as a distinct consumer brand with its own leadership team led by co-founder and CEO Josh Hix.

Danone invests in French baby food start-up Yooji
Danone invested in French baby food start-up Yooji through its Danone Manifesto Ventures unit, joining Caravelle, a family-owned industrial group; and Capagro, a French venture capital fund dedicated to agriculture and food innovation. Founded in 2012, Yooji makes baby meals sourced from organic farms and cooked in France with 100% natural ingredients, without salt or additives sold in more than 600 stores throughout France. This investment is Danone Manifesto Ventures’ fourth in a year. Launched last year, it is a corporate venture capital unit with the mission of ‘supporting the development of innovative companies with high growth potential which share its vision of alimentation’. Along with Yooji, it has invested in French food brand Michel & Augustin, as well as U.S. brands Farmers Fridge and AccelFoods.

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