Icelandic entrepreneur sells Siggi’s yogurt to Lactalis

Lactalis, the French dairy company that agreed to buy Stonyfield last year, is gobbling up Siggi’s yogurt.

Financial terms weren’t disclosed. Siggi’s, of New York, produces “skyr,” a type of Iceland yogurt that has two to three times more protein than a traditional yogurt. Flavors include vanilla, blueberry and peach. Siggi’s yogurt is sold in mainstream grocery chains like Whole Foods, Stop & Shop and Publix. The company will continue operating out of its New York office and will remain a stand-alone company, Lactalis said.

Siggi’s is known for its low-sugar content. Siggi’s flavored yogurts typically have between 8 grams to 11 grams of sugar and are sweetened with fruit and sweeteners like agave and cane sugar. Mainstream yogurts, by comparison, can have twice the amount of sugar. For example, a 6-ounce low fat vanilla flavored yogurt from Dannon has 22 grams of sugar.

“Our core values of clean ingredient label and less sugar will remain 100 percent unchanged,” founder Siggi Hilmarsson said in a statement. “Consumers everywhere are actively trying to reduce sugar in their diets, so our offering has a global relevance.”

Hilmarsson, an Icelandic entrepreneur, started the company out of his kitchen in 2005 after moving to New York City to attend Columbia Business School. He told Buyouts in 2012 that yogurt sold in the U.S. was too sweet: “Americans eat way too much sugar. … Yogurt is really healthy. At the same time, some of those health benefits get lost because you put too much sugar in them.”

Siggi’s went up for sale earlier this year, according to press reports. JP Morgan advised on the process. The company was seeking $500 million to $600 million, one GP said. Siggi’s is believed to have sold for around $500 million, the source said.

Siggi’s is Lactalis’s latest yogurt acquisition. In July, the company agreed to buy Stonyfield from Danone for $875 million.

Private equity has been interested in the sector. Noosa Yoghurt, which offers a full-fat type of yogurt, is backed by Advent International. TPG famously provided a $750 million lifeline to Chobani in 2014. Last year, Castanea Partners acquired Yasso Inc, known for its Greek yogurt bars. Private equity, however, was not involved in the Siggi’s process, two sources said.

Siggi’s has raised venture funding. The company closed a friends-and-family round, which included funding from a Columbia Business School professor, in 2007. Revelry Brands acquired a minority in 2010. Emmi bought its minority stake in 2013, which saw Revelry exiting, PitchBook said. Emmi, a Swiss milk producer, said Jan. 5 that it was selling its stake to Lactalis. The deal will produce a mid-double-digit-million Swiss franc profit gain for Emmi this year, Reuters said.

Executives for Lactalis and Siggi’s could not be reached for comment.

Action Item: Contact Hilmarsson at hello@siggis.com