As Oatly scales its U.S. operations, Millville, New Jersey-based Innovation Foods announced this month that it is building a new $45 million processing and packaging facility to produce plant-based aseptic and extended shelf life beverages for the Swedish oatmilk maker.
A family-owned and operated business, Innovation Foods develops and produces plant-based and functional beverages and juices for both Oatly and probiotics drink brand Goodbelly.
According to Innovation Foods general manager Nick Catalana, his company and Oatly first connected around 2007, nearly a decade before the plant-based brand would launch in North America. In 2015, as Oatly began preparing its U.S. launch, the two came together and struck a multi-year $110 million partnership to begin production in New Jersey, with its Millville facility going online in 2019.
The new facility, designed by Bosco Architects, will be 71,866 square feet and located directly behind the existing production complex. Catalana noted that there are also potential plans for expansion in the future that would extend the facility to more than 125,000 square feet.
The building is currently under construction and expected to open next year. The company anticipates it will create 40 new jobs, including production line workers. When completed, it is expected to be the only low acid aseptic facility in New Jersey and one of only 25 in the country.
“This is sort of like our masterpiece,” Catalana said. “It’s the culmination of a partnership between two families and two businesses that have very similar values and see a common future together.”
The expansion comes as Oatly undertakes a global growth strategy, including in Europe and Asia. The company submitted initial plans for an initial public offering (IPO) last month to the U.S. Securities and Exchange Commission (SEC) and has hired Morgan Stanley, JPMorgan and Credit Suisse as underwriters on the offering.
According to market research firm IRI, Oatly’s U.S. dollar sales grew 196.3% to $56.8 million in the 52-week period ending February 21 — outpacing category leader Planet Oat, which was up 167.7% to $88.1 million. A 2020 report by Mergermarket said the global company generated over $200 million in revenue in 2019 and was expected to have doubled that last year.
“Innovation Foods has played an instrumental role in Oatly’s U.S. journey, from helping to produce our first cases of chilled oatmilk four years ago to today,” said Mike Messersmith, President North America for Oatly, in a statement. “All along the way they’ve been fantastic operational partners, who value relationships and doing good work the right way. We are really excited for this next step in Innovation’s business, as we continue to work together to make sustainable, plant-based options available to so many people across the country.”
Beyond working with Oatly, Innovation Foods is also growing its overall business through expansions of its warehouse, trucking and logistics services, Catalana said.
“We’re really excited to get this off the ground and running,” Catalana said. “It’s an exciting time for us. It’s an exciting time for the city of Millville — they’ve been super supportive of us and doing this project. I think it’s just a great stepping point for Innovation to really grow.”