Lassonde Industries Inc., a North American food and beverage conglomerate, announced on Thursday that it will acquire Apple & Eve, LLC, a fruit juice company with a national footprint, for $150 million.
The Quebec-based company entered a definitive agreement through US Juice Partners, LLC, a subsidiary, to enact the agreement. According to the release, the deal will give Lassonde 90 percent equity interest in the brand and its distribution. The other 10 percent will go to members of the Lassonde family through their existing equity interest in US Juice Partners and a contribution toward the acquisition.
Other Lassonde juice brands include Fairlee and Oasis, to name a few, which are more focused on the Canadian market. The acquisition gives Lassonde its most identifiable consumer packaged goods brand, which could help the Canadian company make a greater push below the border. It will also expand Lassonde’s operations in the U.S. from its primary role in private label, buoyed by its $390 million acquisition in June 2011 of Clement Pappas, a New Jersey-based private label supplier of juices, teas and waters.
“Our entry into the branded juice business in the United States represents another major milestone in our North American strategy,” CEO Pierre-Paul Lassonde said in a release. “It is aligned with our strategy of consistent, measured growth and enhances our overall position in the industry by providing an excellent platform for the future.”
Apple & Eve, based in Port Washington, N.Y., was founded by the Crane family in 1975 and has since become one of the more pervasive ready-to-drink juice brands in the mainstream market. Its portfolio includes more than one hundred different juice products under the Apple & Eve brand name, as well as a variety of sub brands — Sesame Street, Fruitables, Waterfruits, Organics and Quenchers. The company also owns and markets juice products under the brand names Northland, Seneca and The Switch.
The company had previously received investment in 2007 from ClearLight Partners, LLC.
In another release, Gordon Crane, Apple & Eve founder, president and CEO said that he looks forward to continued innovation with Lassonde.
“I am so proud of what we have built at Apple & Eve over the last 40 years, and as CEO I look forward to entering a new exciting chapter in our company’s history,” Crane said in the release. “By joining Lassonde Industries, I am confident that our combined entities will deliver strong growth behind the brands we have built.”
The full Lassonde release and greater financial details are below:
ROUGEMONT, QC, July 3, 2014 /CNW Telbec/ — Lassonde Industries Inc. (TSX: LAS.A) (“Lassonde”) has entered into a definitive agreement, through one of its U.S. subsidiaries, with US Juice Partners, LLC to acquire privately owned Apple & Eve, LLC of Port Washington, New York, for a total cash consideration of US$150.0 million payable at closing, subject to adjustments for working capital and other items.
Upon closing of the transaction, expected to occur in July 2014, Lassonde will have a 90% equity interest in Apple & Eve and its complete line of juice and drink brands distributed widely across the United States. Through their existing equity interest in the acquiring U.S. subsidiary and a capital contribution to the acquisition financing, members of the Lassonde family will own the remaining 10% equity interest.
“Our entry into the branded juice business in the United States represents another major milestone in our North American strategy,” said Pierre-Paul Lassonde, Chairman of the Board and Chief Executive Officer of Lassonde Industries Inc. “It is aligned with our strategy of consistent, measured growth and enhances our overall position in the industry by providing an excellent platform for the future.”
The acquisition will be financed as follows: US$75.0 million under the term credit facility of a Lassonde U.S. subsidiary, US$67.5 million from a combination of cash, cash equivalents on hand and Lassonde’s Canadian operating credit facility, with the remaining US$7.5 million provided by equity investment of members of the Lassonde family. Financing fees related thereto are estimated at US$2.0 million while other fees related to the transaction are estimated at US$3.5 million. Closing of the transaction is subject to customary terms and conditions, including receipt of regulatory approvals.
Benefits of the Transaction
The acquisition of Apple& Eve is expected to provide Lassonde with:
increased critical mass to support customers throughout the U.S. and benefits from combined logistics, distribution, purchasing and other economies of scale;
a more diversified and balanced product portfolio in the U.S. and an entry point in national brand products in the U.S. market; and
growth opportunities in the U.S. national brand juice and drink market for Lassonde’s existing products.
“We are pleased to add one of America’s best known juice brands to our portfolio,” said Jean Gattuso, President and Chief Operating Officer of Lassonde Industries Inc. “Like Lassonde in Canada, Apple & Eve is synonymous with innovative products in the health and wellness segment in the U.S. We are confident in our ability to continue to grow the brand.”
“I am so proud of what we have built at Apple & Eve over the last 40 years, and as CEO I look forward to entering this new exciting chapter together. By joining Lassonde, we will remain highly focused on creating innovative, on-trend products under the iconic Apple & Eve brand and the other strong brands in our portfolio,” said Gordon Crane, Founder, President and Chief Executive Officer of Apple & Eve.
Apple & Eve
Apple & Eve is the leading independent branded juice company in the U.S., with total annualized net sales ofUS$190.0 million and a trailing 12-month adjusted EBITDA of US$15.2 million.
Founded by the Crane family in 1975, and headquartered in Port Washington, NY, the company focuses on healthy and innovative juice products. The Company offers more than one hundred different juice products sold under its iconic flagship brand name, Apple & Eve, and includes a portfolio of sub brands including Organics, Fruitables, Quenchers, Waterfruits and Sesame Street. Additionally, it owns and markets juices under Northland, Seneca and The Switch brands. Apple & Eve products are sold in supermarkets, mass merchandisers, warehouse clubs, natural food stores, schools and convenience stores across the country. For more information, visit www.appleandeve.com.
Lassonde Industries Inc.
Lassonde Industries Inc. is a North American leader in the development, manufacture and sale of a wide range of fruit and vegetable juices and drinks marketed under brands such as Everfresh, Fairlee, Flavür, Fruité, Graves, Oasis and Rougemont.
Lassonde is also the second largest producer of store brand ready-to-drink fruit juices and drinks in the United Statesand a major producer of cranberry sauces.
Lassonde also develops, manufactures and markets specialty food products under brands such as Antico andCanton. The Company imports and markets selected wines from various countries and manufactures apple ciders and wine-based beverages.
The Company produces superior quality products through the efforts of some 2,000 people working in 14 plants across Canada and the United States. To learn more, visit www.lassonde.com.