The WhiteWave Foods Company, a leading consumer packaged food and beverage company in North America and Europe, plans to acquire Earthbound Farm, a leading organic food brand, from its existing shareholders led by Kainos Capital and founders Drew & Myra Goodman, for approximately $600 million in cash.
With anticipated 2013 net sales of more than $500 million, Earthbound Farm is the largest organic produce brand in North America. It produces and markets an extensive line of organic fresh fruits and vegetables, frozen fruits and vegetables and dried fruits and snacks. WhiteWave manufactures, markets, distributes and sells branded plant-based foods and beverages, coffee creamers and beverages and premium dairy products throughout North America and Europe under the Silk, Horizon Organic, International Delight and Land O Lakes brands, the latter of which is owned by Land O’Lakes and is used by license.
“Earthbound Farm is an outstanding organization well-known for innovation, freshness, organic stewardship and food safety. It is a natural extension of our business that reaffirms WhiteWave’s leadership in the organic foods and beverages industry in North America,” said Gregg Engles, chairman and CEO of WhiteWave. “Fresh foods are one of the most attractive, emerging trends in the food industry today and the market for organic products continues to grow steadily. With Horizon Organic and Earthbound Farm, WhiteWave will now provide the two most popular gateways for consumers to enter into the organic category: produce and dairy.”
According to Engles, during the last year, WhiteWave has established a solid foundation and delivered strong financial results as an independent company, and this acquisition will allow the company to drive additional shareholder value. The acquisition is expected to be accretive to earnings per share in the first year after close.
“For 30 years, Myra and I have been committed to Earthbound Farm's mission to bring the benefits of organic food to as many people as possible,” said Earthbound Farm co-founder Drew Goodman. “We both believe that WhiteWave continues to be a leader in improving how food is produced and will help Earthbound Farm achieve its original mission and reach its full potential. We're excited for the future of Earthbound Farm and the opportunity to join the WhiteWave family."
“I can’t imagine a better fit for Earthbound Farm than WhiteWave, bringing together two of the leading companies in the good food movement,” said Earthbound Farm CEO Charles Sweat. “Both companies have a heritage nurtured from small beginnings. And both companies believe in the importance of scaling the production of better food that makes for healthier people and a healthier planet.”
The acquisition, which is subject to regulatory approvals and customary closing conditions, is expected to be completed during the first quarter of 2014.
According to a statement regarding the acquisition, WhiteWave plans to operate Earthbound Farm as a separate business unit, based in San Juan Bautista, Calif., and added that no significant operational changes are anticipated at Earthbound Farm as a result of the acquisition.
J.P. Morgan acted as financial adviser and Haynes and Boone acted as legal adviser to WhiteWave. Barclays and Houlihan Lokey acted as financial advisers and Weil, Gotshal & Manges and Cooley acted as legal advisers to Earthbound Farm.