Bolthouse Farms Sold to Butterfly Equity for $510 Million
Los Angeles-based private equity firm Butterfly in April agreed to acquire Bolthouse Farms from Campbell Soup Company for $510 million in cash – roughly $1 billion less than what the soup conglomerate paid when it acquired the 104-year-old food and beverage brand in 2012.
The deal will return control of Bolthouse to Jeff Dunn, an operating partner at Butterfly who will again assume the chief executive role at Bolthouse upon the deal’s close. Dunn previously served as president and CEO of the brand from 2008 until 2012 when it was purchased by Campbell for $1.55 billion. With Dunn still at the helm, Bolthouse became a part of Campbell’s Fresh Division. In 2014 he took over as president of the division until his departure in 2016, when he left Campbell to head up now-defunct beverage technology company Juicero.
Based in California, Bolthouse Farms produces plant-based milks, juices, protein drinks, salad dressings, and baby carrots. According to a press release, the company employs about 2,200 people and owns manufacturing facilities in California, Illinois, Washington, and Ontario.
Founded in 2016, Butterfly Equity has primarily focused its acquisitions on the food sector, previously purchasing striped bass producer Pacifico Aquaculture, farm-to-table fast casual restaurant Modern Market, and Los Angeles-based restaurant Lemonade. Bolthouse Farms is the firm’s first foray into the CPG space.
“We are thrilled to partner with a vertically-integrated produce and fresh food leader with a history as rich as Bolthouse Farms, and we believe the company’s future is very bright especially given the continued rise of plant-based food in the diet of today’s consumer,” said Butterfly co-founder Adam Waglay in a press release.
In August 2018, following the abrupt departure of CEO Denise Morrison earlier that spring, Campbell announced a large scale cost-saving strategy which included shuttering its Fresh Division and putting brands including Bolthouse and salsa brand Garden Fresh Gourmet on the market.
Though the division accounted for $2.1 billion sales – 25 percent of Campbell’s overall revenue – the conglomerate had long struggled to turn around its overall declining sales (down 3 percent in the fourth quarter of 2018) and felt the division’s fresh focus was outside its core competency.
During Campbell’s 2018 end of year earnings call with investors, interim president and CEO Keith McLoughlin said the company intends to use the proceeds from the sale of the Fresh Division brands to pay off debt.
LifeAID Raises $7.7 Million to Support Distribution Growth
On April 1, functional beverage brand LifeAID announced it had raised $7.7 million to support expanded nationwide distribution as the company seeks to grow in mass, grocery and convenience accounts across the country.
The round included a combined $4.7 million in equity investments from firms Everplus Capital and Cambridge Companies Special Projects Group (SPG), as well as several angel investors. An additional $3 million in debt financing was raised from an asset-backed line of credit with Dwight Funding.
Under the terms of the deal, Everplus Capital and Cambridge SPG will work with LifeAID in an advisory capacity, but will not gain board seats.
“Working with the LifeAID team on this transaction has been highly rewarding,” Filipp Chebotarev, COO & Partner at Cambridge SPG, told BevNET in an email. “Aaron and Orion have built an innovative, fast growth, high margin business that has struck a loud chord with core customers focused on health, wellness and fitness. We look forward to being a partner in their growth journey.”
Speaking to BevNET, LifeAID co-founders Orion Melehan and Aaron Hinde said the company recently secured a chainwide expansion with Walmart, rolling out to the retailer’s 4,300 stores in the near future. The company is also now in 15 Kroger divisions and recently received authorization with Wegmans. LifeAID is also growing its footprint in the travel channel, adding 90 retail locations across ten East Coast airports.
Melehan said one of the company’s goals for 2019 is to provide additional support to its full functional product portfolio. Having initially built a consumer base with its FitAID line in gym channel accounts, LifeAID is now looking to provide additional marketing support for its FocusAID, ImmunityAID, and PartyAID products.
“We’re going to build a sales story around FocusAID and prove out the platform that we can build a better-for-you company with vitamin drinks that consumers actually enjoy drinking,” Melehan said. “Part of the funds is not only to back up our retail authorizations, but to create additional sales stories for our other SKUs.”
The company has established a DSD network in the Pacific Northwest which includes distributors The Odom Corporation, Sound Beverage Distribution Inc., Craig Stein Beverage, and NW Beverages. In Northern California, the company has partnered with DBI Beverage.
Monster and Bang Litigation Row Rolls On
Monster Energy fired back against Vital Pharmaceuticals (VPX Sports) in April in a First Amended Complaint that accuses the Bang maker of “flagrant consumer deception and anti-competitive business practices.”
The compliant, filed in U.S. District Court for the Central District of California, followed a lawsuit filed by VPX in late March accusing the energy drink maker of trademark infringement, trade dress infringement, and unfair competition over its use of “REIGN,” which Monster announced as the name of its new performance energy drink, positioned as a direct rival to VPX’s Bang. The complaint lists a litany of charges, including unfair competition, false advertising, trade libel, and several violations related to the protection of trade secrets.
In the complaint, which names VPX founder/CEO/chief scientific officer Jack Owoc as a plaintiff, attorneys for Monster decry VPX and Owoc’s actions as “damaging, dangerous and despicable.” These actions, according to plaintiffs’ attorneys, include lying to consumers, cheating government regulators, stealing from competitors, and misappropriation of confidential trade secret information.
“From fraudulent health claims to touting an invalid patent to outright theft, our complaint provides many documented examples of Bang’s false, misleading, anti-competitive, and improper actions,” the company said in a statement emailed to BevNET. “It is time that Bang is finally held accountable for its deception. We look forward to presenting all of the facts and revealing the truth about Bang.”
The complaint also includes new accusations against VPX of attempting to steal trade secrets and employees from Monster. The documents cite an incident in which a Bang product manager offered a Monster employee a job in exchange for stealing proprietary pricing data from the company, and a second incident in which former Monster employees downloaded confidential information from the company before starting new roles at VPX.
In an email response to BevNET, Marc Kesten, general counsel and ‘change implementation strategist’ at VPX, called Monster’s FAC “unsworn and unverified” and a “cheap, sensational ‘press release’ dressed up as a complaint.
“It is evident that Monster is desperate to divert attention from VPX’s legitimate lawsuit against Monster’s knockoff Reign energy drink, which not only infringes VPX’s Bang energy drink’s distinctive trade dress, but also VPX’s rights to the registered trademark REIGN (U.S. Reg. No. 5,107,809), which was registered and used years before Monster and its spinoff company, Reign Beverage, decided to usurp it,” Kesten wrote.
Q Mixers Lands $40 Million Investment
Brooklyn-based mixer brand Q Mixers on April 4 announced a $40 million investment from Eurazeo Brands, the CPG-focused arm of French investment company Eurazeo.
Launched in 2008, Q Mixers has emerged as a success story within the fast-growing premium cocktail mixer segment. The brand markets a variety of non-GMO tonics and sodas in retailers nationwide, including Target, Kroger and Whole Foods.
The company previously secured an $11 million funding round led by First Beverage Group in 2016.
As part of the deal, Jim Goldman, a senior advisor at Eurazeo and a former president of Campbell Soup’s North American Food and Beverage Division, will join the board of directors at Q Mixers. He will be joined by George Birman, consumer growth investor at Eurazeo.
Silbert noted the appeal of bringing in senior level operators with experience in high-end branded products to guide Q Mixers forward. He said the new funding will go towards growing both the company’s trade and consumer marketing efforts, the details of which were yet to be determined.
“We are really excited about playing this game to win,” said Silbert. “We’ve been really disciplined for 12-13 years now. We feel this inflection point and we want to race ahead and act as a category leader.”