Inventure Foods to be acquired by Utz Quality Foods
Salty snack maker Utz Quality Foods LLC (Hanover, Pa.) has agreed to acquire specialty food company Inventure Foods Inc. (Phoenix, Ariz.) for approximately $165 million, including the assumption of $75 million of debt plus other considerations. Publicly traded Inventure Foods has manufacturing facilities in Arizona, Indiana, Washington, Oregon and Georgia, where it makes products in the better-for-you and indulgent snack and beverage categories, including Boulder Canyon Foods, Jamba, Seattle’s Best Coffee, Vidalia Brands, and Sin In A Tin gluten-free desserts. Inventure reported consolidated net revenues decreased 12% to $101 million for the six months ended July 1, 2017, reflecting a 9% increase in its snacks segment and a 30% decline in its frozen products segment. Inventure announced the strategic sale of its frozen business to Oregon Potato Company for $50 million in September 2017.
Hearthside Foods gains nutrition bar capacity
Hearthside Food Solutions (Downers Grove, Ill.), a large independent bakery and contract food manufacturer, is to purchase Standard Functional Foods Group (SFFG, Nashville, Tenn.), a contract manufacturer of nutrition bars and a unit of Standard Candy Company. Standard Candy began as a regional confectioner in 1901 and expanded into bars in 1999 through SFFG, which manufactures under contract to many large food companies and brands. The acquisition builds on Hearthside’s 2015 purchase of VSI, a large European bar producer, and the separate purchase of a nutrition bar production facility in Boise, Idaho from a subsidiary of Post Holdings to scale up VSI’s business in the Americas. The SFFG acquisition will expand Hearthside’s network to a total of 24 production facilities. The U.S. nutrition bar and gel category grew 9.5% in 2016, reaching $4.9 billion in annual sales, according to Nutrition Business Journal. Hearthside was acquired by Vestar Capital Partners and the merchant banking division of Goldman Sachs in 2014.
Hormel acquires Columbus Craft Meats
Hormel Foods Corporation (Austin, Minn.) will acquire Columbus Craft Meats (Haywood, Calif.), a premium deli meat and salami company, from Arbor Investments, for approximately $850 million. Columbus’s annual sales are approximately $300 million with an expected growth rate in excess of 5%. In announcing the deal, Columbus said, “We wanted to find a partner who respects the Columbus brand, our product quality, our heritage and our craft mentality,” adding that through the first half of 2017 it was the fastest growing deli meat brand in the country. In an effort to simplify ingredient labels, Columbus says it is working to replace its current nitrates and nitrites with natural sources of nitrites, and is “committed to using more natural ingredients which includes meat from animals raised without antibiotics.” In 2015 Hormel Foods acquired Applegate Farms, a leader in natural and organic deli meats, for about $775 million.
Cargill acquires Diamond V to boost natural animal health and nutrition
Cargill (Minneapolis, Minn.) is to acquire Diamond V (Cedar Rapids, Iowa), a researcher and supplier of natural immune support products to improve animal health and food safety. According to Cargill, the acquisition represents a response to growing consumer preferences for natural and wholesome food production and follows Cargill’s recent investment in Delacon Biotechnik, an Austrian provider of plant-based phytogenic additives. While Diamond is expected to give Cargill a strong position in the $20 billion global animal feed additives market, the deal also includes Diamond V’s human health business, Embria Health Sciences and its branded product EpiCor, a whole food fermentation ingredient that supports immune and digestive health and has been the subject of several human clinical trials.
Constellation Brands buys into medical marijuana industry
Constellation Brands (Victor, N.Y.), a Fortune 500 company, has agreed to acquire a minority stake in Canopy Growth Corporation (Smiths Falls, Ontario, Canada), a provider of medicinal cannabis products. The $7.3 billion wine, beer, and spirits giant expects to invest approximately C$245 million for 9.9% of Canopy Growth, plus warrants. Founded in 2014, Canopy Growth is traded on the Toronto Stock Exchange and has a market cap of more than C$2 billion. Cannabis products have been viewed as potential competition for the alcoholic beverages industry, but Constellation has framed it as an opportunity, stating: “Our company’s success is the result of our focus on identifying early stage consumer trends, and this is another step in that direction.” Canada is expected to legalize the recreational use of cannabis in 2018. “Canadian companies like Canopy Growth are breaking trail in the development of a worldwide cannabis market… but U.S. workers and tax rolls are being left out as long as prohibition remains in place at the federal level,” said Tom Adams, managing director and principal analyst at BDS Analytics (Boulder, Colo.), a market research consultancy focused on the cannabis market. Total U.S. medical use of cannabis (pharmaceuticals, nutraceuticals, topicals) was $4.03 billion in 2016 out of a total U.S. cannabis market, both illicit and legal, of $47.4 billion, according to Arcview Market Research, which partners with BDS on market forecasts.
DanoneWave invests in manufacturing capacity
DanoneWave (White Plains, N.Y. and Broomfield, Colo.), a business unit formed following the acquisition of WhiteWave Foods by Danone in April 2017, will invest up to $60 million in its plant-based beverage manufacturing operation in Rockingham County, Va., according to the Augusta Free Press. DanoneWave will receive a $700,000 performance-based grant from the Virginia Investment Partnership (VIP) program. With more than $6 billion in revenue, DanoneWave is one of the country’s largest public benefit corporations; its portfolio of natural, organic and plant-based brands include Activia, Earthbound Farm, Horizon Organic, Silk, So Delicious, Vega and Wallaby Organic.
Frutarom acquires 100% of specialty nutrition company Enzymotec
Frutarom Group (Tel Aviv, Israel), a global flavors and natural specialty fine ingredients company, is to acquire 100% of Enzymotec (Migdal HaEmeq, Israel), a nutritional ingredients and medical foods company, for around $210 million. Frutarom already owned approximately 19% of Enzymotec, which had annual sales of $47 million for the 12 months ended June 2017, to which its nutrition segment contributed approximately, $36.5 million, including sales from InFat, an infant formula product, and other biofunctional lipid ingredients. Enzymotec’s VAYA Pharma medical foods segment represented 23% of sales in 2016. The acquisition benefits Frutarom “in the fields of pharmaceuticals, dietary supplements, designated foods for infants in the field of infant formula (where Frutarom has almost no activity currently) and elderly clinical nutrition in which Frutarom is active,” the company said. Frutarom has annual sales approaching $1.5 billion and is targeting at least $2 billion by 2020. Enzymotec is Frutarom’s ninth acquisition this year.
CRN reports supplement usage up 5%
Dietary supplements usage has reached an all-time high among U.S. adults, with 76% reporting they consume dietary supplements, up five percentage points from last year’s results, according to an annual survey by the Council for Responsible Nutrition (CRN, Washington, D.C.). The CRN Consumer Survey on Dietary Supplements, conducted by Ipsos Public Affairs, also found that nearly 9 in 10 (87%) of U.S. adults have confidence in the safety, quality and effectiveness of dietary supplements overall; 76% of U.S. adults perceive the dietary supplement industry as trustworthy, up three percentage points from last year. In its eighteenth consecutive year, the CRN survey is a resource for statistics on usage of and confidence in dietary supplements.
MyCloudz acquires Gridiron BioNutrients to enter CBD wellness industry
MyCloudz Inc. (Spokane, Wash.) has announced the acquisition of Gridiron BioNutrients, also of Spokane, in a share-for-share transaction and will change its operating name to Gridiron BioNutrients. Founded by CEO Darren Long, a former NFL and USFL player, Gridiron produces nutritional products infused with high quality cannabidiol (CBD), a cannabis compound that may have benefits for certain health conditions without causing lethargy or dysphoria. Gridiron’s portfolio includes organic CBD-rich hemp oil and Gridiron MVP water, a hydration drink with nano CBD, trace minerals, probiotics, electrolytes and minerals. Long became a nutrition and health advocate after suffering symptoms from chronic traumatic encephalopathy (CTE) or brain concussions.
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