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Hormel sells CytoSport to PepsiCo for $465 million
Hormel Foods (Austin, Minnesota) is selling its CytoSport business, including Muscle Milk protein drinks, to PepsiCo for $465 million in cash. Hormel acquired CytoSport Holdings in 2014 from the Pickett family and TSG Consumer Partners for approximately $450 million to expand Hormel’s portfolio of protein-rich foods and serve as a growth catalyst for its Specialty Foods segment; CytoSport had annual sales of around $370 million at the time. In 2017, Hormel reported a sharp decline in Muscle Milk RTD beverages, citing competition in the convenience channel. Hormel said CytoSport posted total net sales in fiscal 2018 of about $300 million. Founded in 1998, CytoSport started out as a sports nutrition brand for athletes, notably weight lifters.
Tilray to acquire Manitoba Harvest hemp foods
Cannabis company Tilray Inc. (Nanaimo, British Columbia, Canada) is buying the vertically integrated hemp food manufacturer Manitoba Harvest (Winnipeg, Manitoba, Canada) from The Compass Group and othershareholders for up to CA$419 million (US$316.3 million on Feb. 20). Manitoba Harvest generated CA$94 million (US$68.9 million on Jan. 2) in gross revenue in 2018. The acquisition expands Tilray into the natural foods category and brings Manitoba Harvest expertise in working with cannabinoids, including cannabidiol (CBD). Manitoba Harvest sells hemp seeds, oil, granola, protein powder and milk alternatives. It plans to launch hemp extracts with CBD and hemp wellness bars this summer. Manitoba Harvest was an NCN Presenting Company in 2008, later receiving a Series A investment led by Canadian venture capital firm Avrio before being sold to Compass in 2015 for CA$132.5 million (US$106.5 million on June 8, 2015). Tilray’s revenue stood at CA$35.6 million (US$27.6 million) for the nine months ended Sept. 30.
Watson to expand Glanbia’s nutritional ingredients portfolio
Glanbia plc (Kilkenny, Ireland) is acquiring non-dairy ingredients company Watson Inc. (West Haven, Connecticut) for $89 million to broaden the capabilities of its wholly owned subsidiary Glanbia Nutritionals and expand its geographic footprint in the United States. Watson has 300 employees and 2018 revenue of $101 million. Watson makes custom nutrient premixes, specialty nutrients and bakery ingredients. It serves the dietary supplement and food industries offering capabilities like microencapsulation, micronizing, and spray drying. Within Glanbia Nutritionals, which also includes the group’s U.S. cheese business, Nutritional Solutions delivered 3 percent revenue growth in constant currency to €526.7 million ($602.4 million on Dec. 30) in 2018. Glanbia Performance Nutrition, which houses sports nutrition and fitness brands like Optimum Nutrition, Isopure and thinkThin, grew 2018 revenues 9.5 percent to €1.2 billion ($1.37 billion on Dec. 30). “Consumer demand for our brands and nutritional ingredients remains strong, underpinned by positive long-term global health and wellness trends,” said Siobhán Talbot, group managing director.
Perfect Day raises $24.7 million for animal-free dairy
Perfect Day (Berkeley, California), a developer of animal-free dairy products using fermentation technology, raised $24.7 million and received its first patent for use of animal-free dairy proteins in food applications. According to the company, the raise signifies the largest Series A in the history of the emerging food tech space. Temasek led the round; repeat investor Horizons Ventures contributed $6 million. Other investors included Continental Grain, Iconiq Capital, Lion Ventures and Verus International.
Hydrow receives $20 million growth investment
Hydrow by CREW (Boston, Massachusetts), maker of an outdoor reality rowing machine, has gained a $20 million growth equity investment led by L Catterton. Founded in 2017 by U.S. National Team Rowing Coach and entrepreneur Bruce Smith, Hydrow offers a live, on-river outdoor rowing experience at home. The rowing sessions engage twice as many muscles than biking or running and burn up to 400 calories in a 20-minute workout, according to Hydrow. Sessions are led by professional trainers, many of whom compete at the Rowing World Championships. Hydrow will start shipping its machines in July
2019. L Catterton investments include Peloton, Classpass, Equinox, CorePower Yoga and Bodytech.
P&G acquires This Is L. natural and organic feminine care brand
P&G (Cinncinati, Ohio), the maker of Always and Tampax, is acquiring This Is L., owner of L. products, to meet demand for more natural menstrual products. L. products makes organic tampons and pads without pesticides, chlorine, fragrances or dyes. The company also has a subscription service for natural latex condoms that are glycerin- and paraben-free. The Certified B Corp. was founded by Talia Frenkel, a photojournalist who worked for the Red Cross and United Nations. For every L. product purchased, a donation is made to help make feminine care products accessible to girls and women in need. The company also supports grassroots, women-led enterprises by providing pad-manufacturing machines.
Low-Carb High-Fat LLC raises $7.75 million
Low-Carb High-Fat LLC (LCHF, Durham, North Carolina), a subsidiary of Disruptive Enterprises, a ketogenic lifestyle company, announced raising $7.75 million in a Series A financing from One Better Ventures LLC. LCHF brands include KetoLogic meal replacements and FBOMB natural nut butters and oils. A partnership between the two companies dates back to 2014 when One Better Ventures was an advisor to Scivation Inc., a sports nutrition brand founded by the executive leadership team of Disruptive Enterprises.
Aunt Fannie’s closes $5 million financing
Aunt Fannie’s (Portland, Oregon), a purveyor of “microbiomic” household products and essential oil pest solutions, closed a $5 million financing round led by existing investors, including Monica Nassif, founder of Mrs. Meyer’s, and Caldrea. The new round brings total funding to $10.5 million. Aunt Fannie's says its products have been awarded more A safety ratings than any competing brand in a scientific evaluation by the Environmental Working Group across three cleaning-product categories.
$5 million investment for CBD health & wellness and pet care
Online cannabidiol (CBD) brand Sera Labs Inc. (Los Angeles, California) announced an investment of $5 million from Canada-based private equity fund ToroVerde Inc. Sera Labs was created to expand the range of CBD products in the health & wellness, pain management, beauty and pet categories. Products include a beauty line, Sera Relief oils, pain cream, capsules, gummies and a veterinarian approved Sera Pets CBD oil. Founded and managed by entrepreneur Nancy Duitch, Sera Labs is a female-run company.
Rowdy Mermaid Kombucha completes $3.5 million Series A
Rowdy Mermaid Kombucha (Boulder, Colorado) completed a Series A funding totaling $3.5 million led by KarpReilly, which also has backed Spindrift, KeVita, Zola Coconut Water and Iconic Protein. Other investors included Justin Gold (founder of Justin’s) and Brendan Synnott (co-founder of Bear Naked and EVOL Foods). Rowdy Mermaid is giving about 22 percent of equity to investors, according to the Daily Camera in Boulder. Rowdy Mermaid Kombucha said it is the second-fastest-selling locally brewed kombucha in the Rocky Mountain region, with year-over-year growth of more than 100 percent. The low sugar kombucha beverages are infused with lavender, ginger and other botanicals for added functionality.
Prima raises funds for CBD education
Prima (Santa Monica, California), a startup championing the therapeutic potential of hemp cannabinoids (CBD), announced a $3.275 million investment led by Lerer Hippeau, with Greycroft and others participating. Prima is launching as an online education-first wellness platform in Q1 2019, followed by a line of consumer hemp CBD products in the second quarter. Founded by Christopher Gavigan, who co-founded The Honest Company, Prima’s goal is to help clear up confusion surrounding CBD and hemp cannabinoids. “These molecules matter to humanity, and through Prima, we strive to correct historical stigma and unlock the physiological science about this plant's therapeutic potential,” said Gavigan.
Everbowl secures $3 million from Serruya Private Equity
Everbowl (San Diego, California), a fast-casual restaurant chain serving build-your-own superfood bowls, has secured $3 million in funding from Serruya Private Equity (SPE) through its wholly owned subsidiary International Franchise Inc. Funding will be used to expand in California, with possible market entry into Arizona, Nevada and other states. Bowls are made using bases of no-sugar-added superfood such as açai, pitaya, graviola and acerola, which Everbowl sources from its production facility in Brazil. Everbowl operates 17 locations in Southern California and is slated to open as many as 45 by the end of 2019. Other companies backed by SPE have included Pinkberry, Jamba Juice, Yogen Früz and Cold Stone Creamery.
Alantra acquires Frías Nutrición of Spain
Alantra Private Equity fund has acquired a majority stake in Frías Nutrición (Burgos, Spain). Founded in 1919, Frías produces and distributes vegetable beverages (oats, soybeans, almonds, coconut and rice), broths, creams and other healthy products, mainly for the private label segment. With revenues of €60 million ($67.8 million on Feb. 12), Frías Nutrición has more than 130 employees and a production plant in Burgos.
Beverage startup closes financing for olfactory flavors
Szent (Los Angeles, California), a beverage startup in the bottled water category, announced closing a $2.2 million financing. Launched in October, Szent’s patented scent ring is infused with natural oils and attached to the neck of the bottle to channel flavor through the sense of smell. In 2017, Szent raised $1.5 million in seed financing with the support of a syndicate of independent investors led by former FirstMark Capital co-chairman,Gerald Poch. The same investor group participated in this most recent funding.
Food upcycling technology attracts seed funding
Beyond Food Inc. (Halifax, Nova Scotia, Canada), a start-up developing a sustainable food-upcycling technology, received $1 million in seed funding led by investors including cable communications pioneer Stu Rath and environmental technology inventor Jamie Bagnell. Several professional athletes also invested. Using its proprietary Zero Waste Pod, the company extends the shelf life of “late life” produce, creating nutritious powders that serve as raw ingredients for consumer products. Beyond Food is also the parent company of TDF Sports, a brand of plant-based functional foods and sports nutrition
Tierra Farm acquires Power of 3 seed blends
Tierra Farm (Valatie, New York), a certified-organic manufacturer and distributor of nuts, dried fruits, granola, coffee and chocolate, announced the acquisition of Power of 3 Nutrition (Tenants Harbor, Maine), a seed blend company. Tierra Farm offers 225 products and kosher, gluten-free and peanut-free designations under a “craft organic” approach to food. Products are available at food cooperatives and independently owned grocery stores. Founded in 1999, Tierra Farm was listed on Inc. 5000 in 2017 based on 2016 revenues of $21.4 million.
Chrysalis acquires Phoenix Imports
Chrysalis Acquisition Partners Inc. acquired a majority equity ownership interest in Phoenix Imports Inc. (Surrey, British Columbia, Canada), a distributor of premium, natural, single-ingredient meat and bone dog treats under the Open Range and Exeter Farms brands. Phoenix says its suppliers raise livestock on grass without hormones, antibiotics, steroids and preservatives. Phoenix products are sold at more than 1,000 specialty pet retailers across Canada.
Wheatsheaf acquires Purfresh to reduce food spoilage
TriStrata Group, a subsidiary of Wheatsheaf Group Limited, acquired 90 percent of Purfresh (San Francisco, California), a provider of technology to reduce food spoilage in refrigerated ocean shipping containers. Purfresh combines controlled atmosphere and active atmosphere with ozone technology to reduce decay and food-borne pathogens without using harsh chemicals. The system is typically used for shipping high-value fruits such as blueberries, avocados and mangos. Purfresh also offers cloud-based proprietary monitoring software to provide real-time control over cargo container conditions.
Roark acquires Fitness Connection clubs
Roark Capital acquired a majority stake in Fitness Connection (Houston, Texas) from LNK Partners. Terms were not disclosed. Fitness Connection operates in the “high-value, low-price” fitness segment, offering amenities and services for as low as $10 per month. Founded in 1999, the gym chain has more than 500,000 members across 41 health clubs in Texas, North Carolina and Nevada.
GFI announces $3 million in research grants for meat alternatives
The Good Food Institute (GFI, Washington, D.C.) announced 14 research grants in the field of plant-based and cell-based (lab-grown) meat. GFI received 66 submissions from 18 countries. Awardees come from Canada, China, Estonia, Serbia, Norway, Israel and the United Kingdom. Four awards were made in the United States:
· Physicist Amy Rowat, associate professor, University of California, Los Angeles, for plant-based scaffolds for marbled clean beef.
· Ricardo San Martin, research director & industry fellow, Alt.Meat Program, a visiting professor at the University of California, Berkeley, for incorporation
of oil in plant-based meats. He holds a doctorate in biotechnology.
· Dil Thavarajah, associate professor, Clemson University, for breeding organic pulse and cereal crops towards protein biofortification. Her doctorate is in plant physiology.
· Beth Zotter, president, Trophic LLC, for protein products from red seaweeds.
Not Your Mother's haircare announces strategic growth investment
DeMert Brands (Tampa, Florida), parent company of Not Your Mother's haircare brand, has received a strategic growth investment from Main Post Partners. The Not Your Mother's Naturals line offers salon-quality shampoos, conditioners and styling products that are cruelty-free and contain no sulfates, phthalates, and synthetic dyes.
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