Recent transactions in the nutrition and health & wellness industry

PepsiCo agrees to acquire SodaStream PepsiCo Inc. (Purchase, New York) has agreed to acquire SodaStream International Ltd. (Tel Aviv, Israel) in a transaction valued at $3.2 billion. SodaStream, which makes home appliances that turn tap water into sparkling water, says its products promote health and wellness by helping consumers drink more water, in addition to being environmentally friendly and cost effective. The deal was described by PepsiCo Chairman and CEO Indra Nooyi as being “well-aligned with PepsiCo’s Performance with Purpose,” a commitment set by PepsiCo more than a decade ago to transform its portfolio with healthier, more sustainable and environmentally friendly products. SodaStream also offers consumers an alternative to canned and bottled sodas.

Coca-Cola becomes second largest shareholder in BodyArmor The Coca-Cola Company (Atlanta, Georgia) will acquire a minority stake in BodyArmor (Whitestone, New York), giving the sports and hydration beverages access to Coca-Cola’s bottling system. Coca-Cola will become the second-largest shareowner behind BodyArmor’s co-founder and chairman Mike Repole, who previously co-founded the Smartwater and Vitaminwater brands that Coca-Cola acquired in 2007. The BodyArmor investment will be part of the Coca-Cola North America Venturing and Emerging Brands portfolio. It’s structured to allow Coca-Cola to increase its ownership in the future. BodyArmor contains no artificial colors or flavors and is made with potassium and other electrolytes, vitamins and coconut water. BodyArmor will continue to operate independently. Financial terms were not disclosed.

Full Harvest closes $8.5 million Series A to solve food waste Full Harvest Technologies Inc. (San Francisco, California), a marketplace for surplus produce, closed an $8.5 million Series A financing led by Spark Capital. New investor Cultivian Sandbox Ventures and seed-round lead investor Wireframe Ventures joined the round. Full Harvest operates a B2B marketplace for the purchase, sale and logistics of surplus and imperfectly shaped produce. The company has helped large farms sell and deliver almost 7 million pounds of produce, diverting it from landfills, creating revenue for farmers and savings for food and beverage companies. Citing the Environmental Protection Agency, Full Harvest said more than any other waste, food reaches U.S. landfills and incinerators. Reducing food waste is considered one of the top three ways to reverse climate change.

BlueNalu raises $4.5 million to launch cellular aquaculture BlueNalu (San Diego, California), a pioneer in the field of “cellular aquaculture” to produce seafood products directly from fish cells rather than wild-caught or farmed fish, has announced a $4.5 million seed round. Lead investor New Crop Capital was joined by a coalition of 25 venture organizations and individuals from the United States, United Kingdom, Hong Kong, Israel and Luxembourg. “It’s time to rethink seafood and how we can sustainably feed our global population in the decades ahead,” said Lou Cooperhouse, president and CEO of BlueNalu. “We are extremely pleased by the global reach and diversity of the investors in our seed round … We are also implementing strategic partnerships that will enable us to ultimately reach our target customers.”

Electrolux invests in food waste startup Karma Electrolux (Stockholm, Sweden) has invested in Sweden-based Karma, a startup that helps restaurants and supermarkets reduce food waste by selling unsold food to consumers. The investment is part of a $12 million round with other investors. Electrolux and Karma are also initiating a strategic partnership to explore solutions for reducing food waste. They will combine Electrolux's expertise in appliances and food preservation with Karma's digital platform and expertise in the sharing economy. Reducing food waste is one of the targets of Electrolux’s sustainability framework.

Rabobank challenge seeks solutions to food waste Rabobank (Utrecht, Netherlands) announced the launch of Food Loss Challenge Asia, inviting disruptive start-ups to present to food and agribusiness leaders and investors ag-tech solutions for reducing food loss. Every year, 1.3 billion tons of food goes to waste, while the world's population is expected to increase by 2 billion to more than 9 billion people, Rabobank said. To meet demand, global food production will have to increase by at least 60 percent. Rabobank is committed to contributing to the United Nation’s sustainable development goal of halving food loss by 2030. In 2017, Rabobank loaned around €98 billion (US$117.6 billion on Jan. 2, 2018) to food and agri-businesses.

BabelBark finalizes $4.5 million Series A to advance pet software platform BabelBark Inc. (Newton, Massachusetts), a pet-related software developer, has completed a $4.5 million Series A funding, exceeding the original target of $2.9 million. BabelBark said it would use the additional funding to expand its services globally, invest in marketing resources and recruit talent. Launched in 2016, BabelBark connects pets with pet-care businesses such as veterinary practices, trainers, shelters, groomers, walkers, pet sitters and kennels through a digital platform with a mobile application. "We are ahead of our targets in every parameter, and this funding expansion will help us reach more than 250,000 pets on the platform in the next six months," said Roy Stein, founder and CEO.

Chinova Bioworks secures seed financing for natural preservatives Chinova Bioworks (Fredericton, New Brunswick, Canada), a supplier of an innovative mushroom-based natural preservative for food and beverages, announced the close of a seed round led by DSM Venturing BV and Rhapsody Venture Partners. Other investors included AgFunder and Natural Products Canada. Chinova has developed a preservation technology using mushroom-based chitosan that can be customized to fit the needs of food and beverage producers’ specific microbial issues. Investment will be used to scale production. Chinova was a presenting company at Nutrition Capital Network's Spring 2017 Investor Meeting. DSM is an NCN Cornerstone Investor.

Tosi Health secures significant funding led by Cambridge Special Projects Tosi Health (Anaheim, California) has closed a round of funding led by Cambridge Special Projects Group (SPG), according to a Project Nosh article posted on Cambridge SPG’s website. The “significant multi-million-dollar investment” puts the group in control of 22 percent of the Tosi brand, according to Filipp Chebotarev, Cambridge SPG’s COO and partner. Tosi makes meal replacements, powdered greens, supplements and mini-superfood snacks called Superbites that together comprise a health and wellness and weight management program. All of Tosi’s products contain digestive enzymes. Tosi was a presenting company at Nutrition Capital Network's Fall 2016 Investor Meeting in San Francisco.

Private equity firm buys Indigo Wild natural personal care brand Hammond, Kennedy, Whitney & Company (HKW) has acquired Indigo Wild LLC (Kansas City, Missouri), a manufacturer and distributor of natural and organic bath, skin, home and cleaning products, led by its flagship Zum Bar goat’s milk soap. Indigo Wild was founded in 1996 by Emily Voth and distributes its products through grocery, specialty, e-commerce and direct-to-consumer channels. “We look forward to supporting Indigo Wild with resources and capital to pursue their growth plans in the personal care and home cleaning category. Indigo Wild has a great opportunity to continue expanding their loyal customer following,” said Chris Eline, principal at HKW.

U.S. investors buy Freeletics digital fitness brand Sports and lifestyle startup Freeletics (Munich, Germany) has announced a significant investment by a group of U.S. venture capital companies. Freeletics CEO Daniel Sobhani and the U.S. venture firm FitLab partnered to buy the company from its founders and provide growth capital. Causeway Media Partners, Jazz Venture Partners, Courtside Ventures, Fitlab, Elysian Park Ventures, Ward Ventures and Sobhani are providing capital for the investment. Founded in 2013, Freeletics offers a clothing line and four apps led by its flagship Freeletics Bodyweight, a digital personal trainer that assesses fitness and creates a personalized training plan for the user. The company has 120 employees.

TraceGains acquires Healthnotes TraceGains (Westminster, Colorado), a provider of food safety and quality assurance software for food and beverage companies, has acquired Healthnotes (Portland, Oregon), a pioneer in regulatory and consumer education for dietary supplement suppliers, manufacturers and distributors. Skye Lininger, who founded Healthnotes more than 15 years ago, will become TraceGains’ president of dietary supplements. “With TraceGains, there are tremendous opportunities to rapidly expand our ingredient and regulatory databases to support the needs of the food industry, especially the natural food industry where new products, novel ingredients and claims like ‘organic’ and ‘non-GMO’ need additional compliance support,” said Lininger.

ADM acquires vanilla processor and supplier Archer Daniels Midland Company (ADM, Chicago, Illinois) has completed its acquisition of Rodelle Inc. (Fort Collins, Colorado), a processor and supplier of premium vanilla products, including organic extracts, alcohol-free flavor and paste. In Madagascar, the company owns a stake in Federation Sahanala Vanille, a joint venture between Rodelle and a partnership of local associations that includes more than 2,100 registered vanilla farmers and has the capacity to produce significant volumes of certified organic vanilla. Besides vanilla, Rodelle sells other flavorings, extracts, spice blends and organic spices.

CAVA Group to acquire Zoe’s Kitchen in better-for-you Mediterranean cuisine Zoe’s Kitchen Inc. (Plano, Texas), a publicly traded fast-casual restaurant chain with 261 domestic locations, is to be acquired by Cava Group Inc. (Washington, D.C), a culinary chain with 66 restaurants, for approximately $300 million including debt. Both chains focus on Mediterranean-style cuisine; Cava also sells dips and spreads in Whole Foods Markets and other specialty grocery stores. The acquisition will be financed through a significant equity investment in Cava led by Act III Holdings, the investment vehicle created by Ron Shaich, who is the founder, chairman and former CEO of Panera Bread. For the 16 weeks ended April 16, Zoe’s Kitchen posted a net loss of $3.6 million on revenues of $102.1 million.

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