PE-backed Sovos Brands completes buyout of Rao’s Specialty Foods


Advent International-backed Sovos Brands has closed its previously announced acquisition of New York-based Rao’s Specialty Foods Inc, a maker of pasta sauce. No financial terms were disclosed. Morgan Stanley & Co. LLC served as exclusive financial adviser to Rao’s Specialty Foods on the transaction.

PRESS RELEASE

BERKELEY, Calif., July 18, 2017 /PRNewswire/ — Sovos Brands, a new food and beverage company formed by Advent International, today announced that it has completed its previously announced acquisition of Rao’s Specialty Foods Inc., the producer of Rao’s Homemade, the leading brand of super premium pasta sauce made with only the highest quality natural ingredients. Financial terms were not disclosed.

Rao’s Specialty Foods is the second acquisition in less than six months for Sovos Brands. Rao’s Specialty Foods joins Sovos’ portfolio of high-quality brands in on-trend categories, which also includes Michael Angelo’s Gourmet Foods, a leading producer of premium, authentic frozen Italian entrées. Headquartered in Berkeley, CA, and led by seasoned consumer packaged goods executives, Sovos focuses on businesses with the potential to accelerate growth by investing in distribution, marketing, production and product innovation.

Rao’s Homemade is an iconic brand with a storied heritage dating back to the opening of Rao’s Italian restaurant in East Harlem, New York, in 1896. Established in 1992, Rao’s Specialty Foods produces super premium pasta sauce, known for its commitment to the highest quality ingredients, clean label and superior taste profile. Rao’s Homemade contains no tomato blends, paste, water, starches, fillers, colors or added sugar like many of the other leading brands. In addition to sauces, the company offers a selection of premium dry pasta, dressings, marinades, olive oils, vinegars, tomatoes and fire-roasted red peppers.

“We are thrilled to officially welcome Rao’s Specialty Foods to our family of high-quality, unique brands,” said Todd Lachman, President and CEO of Sovos Brands. “Rao’s Specialty Foods has significant growth opportunities and we look forward to working alongside the company’s talented management team to accelerate its strong growth trajectory.”

“This is an important and exciting day for the entire Rao’s Specialty Foods family,” said Eric Skae, who will continue to lead Rao’s Specialty Foods as General Manager of the business. “The resources and expertise of Sovos and Advent will position us strongly for continued success and future growth. We are excited to partner with the Sovos Brands’ team in this next stage of our development.”

“The Rao’s brand will always have deep meaning for me and my family,” said Frank Pellegrino Jr., Principal of Rao’s Restaurant Group. “I am pleased to know that the Sovos team will honor and preserve our heritage as they lead the business into the future. I look forward to providing counsel to Sovos Brands to ensure that Rao’s Specialty Foods continues to grow and reach more customers with its high-quality super premium pasta sauce and complementary specialty goods.”

“This acquisition is a testament to Sovos Brands’ commitment to establishing itself as a scale player in the consumer packaged goods industry,” said Jeff Case, a Managing Director at Advent International. “We are confident that Rao’s Specialty Foods will have a bright future as part of Sovos Brands and will benefit from its targeted growth strategy.”

This transaction does not include the iconic Rao’s restaurants in New York, Las Vegas and Los Angeles, which will remain under current ownership.

Morgan Stanley & Co. LLC served as exclusive financial advisor and Morrison & Foerster LLP served as legal advisor to Rao’s Specialty Foods on the transaction. Weil, Gotshal & Manges served as legal advisor to Sovos Brands and Advent International.

ABOUT SOVOS BRANDS
Sovos Brands is a new kind of food and beverage company with a mission to acquire and build one-of-a-kind brands. Its portfolio includes Michael Angelo’s Gourmet Foods, a leading producer of premium, authentic frozen Italian entrées, and Rao’s Specialty Foods, a producer of super premium pasta sauce and other Italian specialty foods. Sovos Brands has the soul of a startup, the experience of an industry leader and the financial backing of Advent International, one of the world’s largest private equity firms. The company has a one-of-a-kind approach to brands, business and people—in fact, the only thing that’s old school about the business is the name, inspired by the old Latin term sovos, which means unique or one of a kind. This one-of-a-kind vision leads the company’s focus on people and brands, working to ensure that both can really thrive. Find out more about Sovos Brands at www.sovosbrands.com, Michael Angelo’s Gourmet Foods at www.michaelangelos.com and Rao’s Specialty Foods at www.raos.com.

ABOUT ADVENT INTERNATIONAL
Founded in 1984, Advent International is one of the largest and most experienced global private equity investors. The firm has invested in 325 private equity transactions in 40 countries and as of March 31, 2017, had $39 billion in assets under management. With offices on four continents, Advent has established a globally integrated team of over 180 investment professionals across North America, Europe, Latin America and Asia. The firm focuses on investments in five core sectors, including business and financial services; healthcare; industrial; retail, consumer and leisure; and technology, media and telecom. After more than 30 years dedicated to international investing, Advent remains committed to partnering with management teams to deliver sustained revenue and earnings growth for its portfolio companies. For more information, visit www.adventinternational.com.

Take your pick!

  • Buyouts delivers exclusive news and analysis about private equity deals, fundraising, top-quartile managers and more. Get your FREE trial or subscribe now.
  • VC Journal provides exclusive news and analysis about venture capital deals, fundraising, top-quartile investors and more. Get your FREE trial or subscribe now.