J.H. Whitney seeks buyer for C.J. Foods

J.H. Whitney, one of the oldest private equity firms, has put C.J. Foods up for sale, three sources said.

Lazard is advising on the sale, the people said. Founded in 1985, C.J. Foods is the Bern, Kansas, maker of specialty dry pet food and treats for U.S. super-premium brands.

In April, C.J. acquired Lortscher Animal Nutrition, which provides milling and ingredients to the pet-food industry, Food Business News reported.

C.J. Foods has long been rumored to be up for sale but a process never officially launched until now, one of the people said. Offering memos for C.J. Foods came out before Thanksgiving, the source said. “The first round has started,” the source said.

Bids are due after the New Year, the person said. C.J. is expected to fetch $500 million to $600 million, the sources said.

For J.H. Whitney, the deal dates back to 2014 when the firm acquired C.J. Foods. Golub Capital provided financing to support the deal, a statement said.

The transaction is the latest in the pet sector. Arbor Investments on Dec. 3 closed its buy of the exclusive brands business of Mars Petcare US Inc. It has relaunched the business as Red Collar Pet Foods. Sentinel Capital is also buying Pet Supplies Plus from Irving Place Capital, Buyouts reported.

Restructuring

J.H. Whitney, New Canaan, Connecticut, has been around in its current form since 2004, but predecessor entities have been in business as far back as 1946.

The firm is currently owned by Paul Vigano and Robert Williams, according to the firm’s most recent form ADV filed March 29.

Buyouts reported in December 2016 that J.H. Whitney was restructuring its seventh fund, which had been targeting $800 million in 2010.

It’s unclear how much the firm raised that year, the story said. The pool had a gross asset value of $481.77 million, the Form ADV said. J.H. Whitney’s seventh fund has $52.35 million in dry powder remaining, PitchBook said.

The firm has posted one transaction in 2018. Aveanna Healthcare, owned by Bain Capital Private Equity and J.H. Whitney, acquired Premier Healthcare Services this year.

In late 2017, J.H. Whitney partially exited Precision Medicine Group. The firm also sold Uncle Julio’s, a Mexican restaurant chain, to L Catterton in October 2017.

J.H. Whitney has lost several high ranking executives in recent years. Steven Rodgers, a senior managing director, left earlier this year to join Morgan Stanley Capital Partners, Buyouts reported.

Michael Salvator, a senior managing director who worked at J.H. Whitney from 1997 to 2017, is now chief operating officer of Stone Canyon Industries. Former J.H. Whitney Managing Director James Fordyce left in 2014 and became co-CEO of Stone Canyon. Brian Cherry, a former JH Whitney senior managing director, joined Oak Hill Capital Partners in 2014.

Lazard declined comment. J.H. Whitney, C.J. Foods, and Golub could not be reached for comment.

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