Gruma Corp., which owns Mission Tortillas, is buying all of Casa de Oro including the company’s tortilla production assets, inventories, brand and customer lists. Plaza Belmont, which had a majority stake, is selling its holding. Others exiting include MidStates Capital, Kansas Venture Capital, Midwest Venture Capital and Lewis & Clark Holdings, and Bank Midwest of Kansas City, according to a statement.
“It was 100% sale of all the assets,” says Bob Parnow, Plaza Belmont’s president and COO. “We are out of the tortilla business.”
Plaza Belmont, of Shawnee Mission, Kansas, typically invests in food manufacturers and related industries. In 2004, the PE firm bought Casa de Oro from ConAgra Foods. Parnow declined to disclose how much they invested. In 2008, Plaza Belmont sold Casa de Oro’s Louisville’s plant to company management and the business became known as Mesa Foods.
Omaha, Neb.-based Casa de Oro makes over four million tortillas a day, according to the company’s web site. Products include flour tortillas and flavored tortilla wraps. Parnow says an IRR for the deal would likely be in the “low 20s.”
Earlier this month, Plaza Belmont announced it had sold Mama Rosa’s Pizza to Huntsman Gay Global Capital. The PE firm still has a minority stake in Packaging Products Corp. Plaza Belmont is probably 12 to 18 months away from exiting that investment, Parnow says.
As reported earlier this month by peHUB, Plaza Belmont is expected to begin fundraising for its newest pool in fourth quarter. Fund III is slated to have a $100 million target.
Roughly 75% of Plaza Belmont’s second fund has been invested. Fund II raised $17.1 million in 2004. A majority of the pool was invested within two-and-a-half years (the PE firm invested in Mama Rosa’s in 2006). In fact, the investment period for fund II expired in January 2009, Parnow says. “We can only do add-ons to existing portfolio companies,” he says.
Why has Plaza Belmont waited so long to market for a new pool? The PE firm was told that unless it has a substantial exit it would be difficult to get interest in a new fund, Parnow says. “That’s why we held off,” he says. “We will start in fourth quarter.”