Recent transactions in the nutrition and health & wellness industry

 

Post to spin off Active Nutrition division as a public company

Post Holdings Inc. (St. Louis, Missouri) has announced an initial public offering to establish its Active Nutrition division as a “pure-play, high growth company
with strategic flexibility to pursue strong organic and M&A opportunities.” Active nutrition houses ready-to-drink protein beverages, protein powders,  nutrition bars and nutritional supplements under the Premier Protein, Dymatize, PowerBar, Supreme Protein and Joint Juice brands. The division reported net sales of $827.5 million for fiscal year 2018, a 16 percent annual increase. Post said Active Nutrition’s net sales have increased at a compound annual growth rate of 30 percent since 2014, driven by industry-leading growth in Premier Protein ready-to-drink shakes.Post intends to sell approximately 20 percent of the new public company.

 

Beyond Meat files for IPO

Beyond Meat Inc. (El Segundo, California) has filed with the SEC for up to $100 million in an initial public offering. Founded in 2009, Beyond Meat uses proprietary processes to turn plant-derived amino acids, lipids, trace minerals and water into vegan products that it says have the same taste, texture and
nutritional benefits as meat. Annual net revenues increased to $56.4 million through the third quarter ending Sept. 29— with a loss of $22.4 million for
that period—from $16.2 million at the end of 2016.The company’s flagship Beyond Burger accounts for approximately 70 percent of gross revenues,
but it also makes vegan chicken and sausages. According to the Plant Based Foods Association, sales of plant-based meats grew 24 percent to $670
million in the 52 weeks ending June 2018, up from 6 percent in the 52 weeks ending August 2017; in contrast, animal meats grew 2 percent in the first half
of 2018.

 

Sweetgreen announces $200 million financing led by Fidelity

Sweetgreen (Los Angeles, California), the seasonal “real food” restaurant chain, announced a $200 million financing led by Fidelity Investments, valuing Sweetgreen at more than $1 billion. This round will bring total equity raised to approximately $365 million. The funds will be invested in the chain’s digital
platform, supply chain and blockchain, restaurant expansion, food delivery and social impact. “As a company, we are focused on democratizing real food,” said Jonathan Neman co-founder and CEO of Sweetgreen. “Our vision is to evolve from a restaurant company to a food platform that builds healthier communities around the world.”

 

Natural feminine care brand raises $17.5 million

Rael Inc. feminine care, based in Orange County, California, has raised $17.5 million in a Series A funding round led by Mirae Asset and GS Retail Fund of South Korea. Rael's product line includes organic cotton pads and panty liners—both No.1 Amazon best sellers in their respective categories, according to the company—in addition to biodegradable cardboard and non-applicator tampons. The company has also added a line of Period Beauty items, including facial sheet masks and acne patches for hormonal skin. Total funding to date is $20.4 million. Launched in 2017, Rael is co-founded and led by three women frustrated by the lack of healthy, comfortable and high-performing period care products on the market.

 

 

Foundation Capital leads Series A to develop Simple Habit

Simple Habit (San Francisco, California), a meditation and audio therapy platform for stress reduction, has raised $10 million in Series A funding led by Foundation Capital, bringing the company to $12.8 million in total funding. Simple Habit was founded in 2016 by Yunha Kim, who dropped out of Stanford Graduate School of Business to build the “Spotify of meditation.” Sessions are based on situations such as sleeping, morning anxiety and getting over a breakup. Since Kim graduated from Y Combinator in April 2017, Simple Habit has reportedly achieved 10-fold growth in revenue.

 

 

BOU raises more funds to disrupt stale stock cube category

BOU Brands (New York, New York), maker of better-for-you bouillon cubes, announced a $4 million Series B investment, bringing its total raised to $6.8 million. The company said it has increased sales 500 percent year to date and projects more than $14 million in sales in 2019. Strategic investors included Andy Gellert, president of the Gellert Group; founding investors of SodaStream; and the president of Southern Glazer's Wine and Spirits. Venture investors FounderMade and Nebari Ventures also participated. Since launching in 2017, BOU has expanded its product line from bouillon cubes to gravy cubes, soup cups and miso cubes. It uses natural, non-GMO ingredients and less sodium than other leading brands.

 

LesserEvil attracts investment to expand snack distribution

LesserEvil LLC (Danbury, Connecticut), a producer of organic plant-based salty snacks, received investment from InvestEco Capital Corp. LesserEvil is preparing to expand sales of its popcorn, puffs and chips into multiple channels, and has brought on Ignite Sales Management to help with conventional grocery and Craft Catalyst to help with other channels. It will also boost capacity at its own production facility. LesserEvil “self-manufactures to ensure quality and constantly innovates with new ways to provide healthy snacks to consumers,” said Alex Chamberlin, managing partner of InvestEco. Whipstitch Capital was the exclusive financial advisor to LesserEvil in the transaction. Whipstitch is an NCN Sponsor and Investment Banking Partner.

 

Flying Embers closes investment for better-for-you alcoholic drinks

Fermented Sciences Inc., dba Flying Embers (Ojai, California), a producer of better-for-you alcoholic beverages including hard kombucha and probiotic beer,
closed an investment round led by Ecosystem Integrity Fund. Capital will be used to increase production capacity and expand the Flying Embers brand across
the United States. Flying Embers was founded by its Chief Executive Officer Bill Moses, formerly CEO and co-founder of the KeVita brand of kombucha, which
was acquired by PepsiCo in 2016. Whipstitch Capital served as the exclusive financial advisor to Flying Embers in the transaction.

 

Entrinsic Health partners with Nestlé Health Science on hydration beverage

Entrinsic Health Solutions (EHS, Norwood, Massachusetts) has formed a partnership with Nestlé Health Science (NHSc, Vevey, Switzerland), giving NHSc the exclusive rights to market EHS's Enterade electrolyte beverages. Enterade is made with a patented combination of proprietary amino acids to manage hydration in patients with gastrointestinal (GI) difficulties related to cancer or chronic GI disease. Nestlé Health Science has the right to take over global
commercialization of Enterade following results of a clinical study in neuroendocrine tumor patients. Terms were not disclosed.

 

Stonewall Kitchen acquires Spruce Naturals and Napa Valley Naturals

Stonewall Kitchen (York, Maine) has completed its second acquisition of 2018, acquiring Spruce Naturals LLC (Los Angeles, California), parent of Napa Valley Naturals, from Kendall Cook. Napa Valley Naturals sells certified organic olive oils, specialty vinegars and Montebello Italian pasta. According to SPINS data cited by Stonewall Kitchen’s CEO John Stiker, Napa Valley Naturals is the No. 1 brand of olive oil, balsamic vinegars and wine vinegars in the natural foods channel; similarly, Montebello is the No. 2 brand of shelf-stable pasta. This year, Stonewall Kitchen also acquired Tillen Farms pickled vegetables and cocktail
cherries, as well as a license to the Legal Sea Foods brand for seafood sauces. “We have made significant strides towards achieving our vision of becoming the premier specialty foods platform in North America,” said Stiker.

 

Swander Pace acquires artisanal bakery in Canada

Swander Pace Capital has acquired Bäckerhaus Veit Ltd. (Mississauga, Ontario), a European-style artisan bakery serving “top-tier” retail and foodservice
customers across North America. Founded in 1987 by CEO Sabine Veit, Bäckerhaus Veit draws on more than 90 years of family heritage in the baking industry, dating back to Veit’s family roots in Germany. Swander Pace’s previous transactions in the baked goods industry include Ontario-based Voortman Cookies and Pineridge Bakery, the latter sold to Aryzta AG in 2014.

 

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Nutrition Capital Network is accepting applications for the 2019 NCN Investor Meetings from companies interested in presenting business plans to an audience of qualified investors. Interested investors are also invited to register to attend the events.