San Francisco-based Gryphon on Monday said it had bought Ann’s House of Nuts and American Importing Co., or Amport. The acquisition of both companies is valued at $250 million, a source says. Both transactions closed Friday.
Columbia, Md.-based Ann’s House of Nuts makes private label and branded snack nut and trail mix products. Amport, of Minneapolis, makes and markets private label dried fruits. The companies will not be merged but will operate independently under one holding company, says Nick Orum, Gryphon’s president. They will cooperate on sales and marketing, he says.
The seller of Ann’s House of Nuts is Olympus Partners, a Stamford, Conn.-based PE firm. Olympus acquired a majority of Ann’s from the founding Zinke family in July 2008. The Zinke’s retained a minority under Olympus and will continue to hold that stake under Gryphon, Orum says.
The Stillman family is selling Amport to Gryphon. They will also retain a minority, Orum says.
Gryphon, which has invested in consumer deals before, spent one-and-a-half years building a healthy snack platform, he says. Retailers, Orum says, generate higher margins and profitability on private label products. “Both companies are leaders in their respective categories,” Orum says.
The sale of Ann’s represents a two-and-a-half-year hold for Olympus, which began a process to sell the company in late Spring, says Manu Bettegowda, a partner. Lincoln International, a Chicago investment bank, ran the process. The auction attracted both strategics and private equity firms, Bettegowda says. Buyouts magazine previously reported the sale of Ann’s.
The sale of Ann’s had been expected to close in October. However, the deal was delayed because Gryphon was buying Amport. “We sought to close both deals concurrently with each other,” Orum says.
Gryphon, which typically invests $25 million to $75 million equity per deal, has a history in consumer deals. The PE firm is selling its remaining 6.5% stake in Smile Brands (formerly Bright Now! Dental) to Welsh Carson (Gryphon previously sold Bright Now! to Freeman Spogli in 2005. Freeman, earlier this month, agreed to sell its majority stake in the company to Welsh Carson). In 2006, Gryphon also sold Eight O’Clock Coffee Co. to Tata Coffee of India.
Olympus for its part targets a wide variety of sectors with a focus on healthcare, financial services, consumer and business services. The PE firm typically invests $50 million to $200 million equity per deal. The investment in Ann’s comes from its fourth fund, which raised $757 million in 2003 and is fully invested.
Bettegowda declined to disclose how much Olympus invested in Ann’s or what Gryphon paid. Olympus has an IRR of 30% and the sale of Ann’s to Gryphon is above that 30%, Bettegowda says. Profits at Ann’s jumped by 70% under Olympus’s ownership.
“We are very pleased with this outcome,” said Rob Morris, Olympus’s managing partner, in a statement. “Ann’s management team has done an extraordinary job in executing on the growth opportunities we saw in the healthy snack category.”
City Capital Advisors provided financial advice to Gryphon. (UPDATE: McColl Partners advised Amport).