Harvest Hill Beverage Company, best known as the maker of kids drink brands SunnyD and Juicy Juice, has agreed terms for its acquisition by Guatemalan business group Castillo Hermanos, in partnership with private investment firm Centerview Capital. Terms were not disclosed, though a report in the Wall Street Journal pegged the deal at around $1.5 billion.
Founded in 1886, family owned Castillo Hermanos is a multinational group with more than 20,000 employees operating in over 35 countries, controlling brands such as Gallo Beer (Famosa Beer in the U.S.), Del Frutal and Raptor Energy Drink. All of Harvest Hill’s 1,000+ employees, including management and leadership teams, are expected to retain their positions following the completed transaction.
“In recent years, the company has been working to open itself to the world and bring to life our goal to create global brands that ensure sustained growth and continue to strengthen our leadership,” said Juan Monge Calderón, Chairman of Castillo Hermanos, in a press release. “This acquisition marks a milestone in our history. We welcome the leadership team of Harvest Hill that will join our team and are confident that, together, we will continue to captivate consumers and create world-renowned brands.”
Harvest Hill, part of the Brynwood Partners portfolio, was formed in 2014 to acquire Juicy Juice from Nestlé USA. In the years since, the company has added American Beverage Corporation (Little HUG, Daily’s Cocktails), Nutrament, Poppilu and Sunny Delight under its consolidated umbrella alongside brands like Fruit2O, Veryfine, Big Burst and Guzzler.
The company, which has six manufacturing sites in the U.S., has also stepped out into beverage alcohol with SunnyD Vodka Seltzer in 2023.
“We could not be more excited to build our future with Castillo Hermanos,” said Robert Mortati, President and CEO of Harvest Hill. “Founded on similar values and principles based on respect, quality, innovation, and customer and consumer centricity, Castillo Hermanos’ and Harvest Hill’s strategic visions are aligned. Together, we will be able to scale our businesses, enhancing the presence of our brands across the beverage marketplace.”
Roberto Lara, CEO of Castillo Hermanos, called the agreement “a key moment in our history as we set out to meaningfully expand our reach in the U.S.,” naming Harvest Hill’s “understanding of the beverage category” in the States as an asset to leverage.
The acquisition may clear the way for introducing brands from Castillo Hermanos’ Maravilla business unit (fronted by Del Frutal) to the U.S., as well as new brands, potentially. There’s also the possibility to cut costs by shifting manufacturing to the U.S., where Harvest Hill operates six production plants.
Sunny Delight’s fruit drinks grew sales almost 16% in the 52-week period ended March 21, according to MULO data from Circana (some channels not tracked), outperforming a segment that dropped 7.3% during that window.
Centerview Capital, founded by former Nabisco and Kraft Foods executive Jim Kilts, is also participating in the deal.
“We’ve been impressed by Castillo Hermanos’ business execution and brand portfolio and Harvest Hill’s commercial and operational success,” said Kilts. “Both companies have proven track records of acquiring and integrating assets and our investment underscores the potential of this transaction.”
As the lead arranger and bookrunner on the acquisition financing, Citi is serving as financial advisor to Castillo Hermanos. Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal advisor to Castillo Hermanos.