Verlinvest to seek buyer for popchips

Verlinvest SA is expected to put popchips up for sale, nearly six years after buying the better-for-you snack maker, according to three sources.

How much popchips could fetch is unclear.

The Los Angeles company provides potato and corn chip snacks that claim to be healthier than regular potato chips. Instead of frying potatoes, the company pops them in a pressurized chamber, adds high oleic oils and then covers the treats in seasoning.

Founded in 2007 by Co-Chairmen Pat Turpin and Keith Belling, popchips is part of the better-for-you-snack category. The company doesn’t add preservatives, artificial flavors, or colors to its products. Popchip snacks also don’t have trans fats, saturated fat or MSG. They’re derived from non-GMO sources, gluten-free, vegan and kosher.

One ounce of sour-cream-and-onion popchips has 120 calories, 4 grams of fat and 20 carbs. This compares to one ounce of Lays, which has 160 calories, 15 carbs and 10 grams of total fat.

Popchips “is definitely in the market,” a second source, one of the three, said. The company has gained momentum since the sale of Amplify Snack Brands, which makes SkinnyPop popcorn, to Hershey in December for $1.6 billion. TA Associates is an investor in Amplify.

“It’s not that big,” one of the sources, a GP, said of popchips. A sale will likely attract middle-market consumer PE firms or strategics like Campbell/Snyders, Hershey, Utz or Medora, the Permira portfolio company that makes PopCorners, sources said.

Once very trendy, popchips has lost some of its pop. The company has failed to keep a CEO around for the long term. Paul Davis, the former chief executive of Kettle Foods, joined popchips in January 2014 as CEO. David Ritterbush succeeded Davis less than two years later, in November 2015. Ritterbush joined Quest Nutrition as CEO in February 2017, his LinkedIn profile said. This saw Davis return to head up popchips, LinkedIn said. Popchips did not return calls for comment.

Popchips, with $93.3 million in 2013 sales, ranked No. 5 on the Forbes list of America’s Most Promising Companies. This dropped to $54.7 million in 2015, said, citing Euromonitor data.

One banker, not part of the sources, said the better-for-you-snack category has gone crazy in terms of new market companies. “The chip category has gotten way too many participants,” the source said.

Popchips has been sold twice. In 2008, TSG Consumer Partners, along with Accelerator Ventures and Strand Equity Partners, acquired popchips, PitchBook said. Financial terms weren’t announced but TSG invested $25 million for 30 percent of popchips, Forbes reported.

Popchips was sold again in 2012. This time, Verlinvest and Jamjar Investments acquired popChips. It’s unclear how much they provided.

Verlinvest, Brussels, is a consumer-focused, family-owned investment holding company. The firm manages more than 1.8 billion euros ($2.2 billion) in assets. It will take majority or minority positions, investing from 30 million to 150 million euros per transaction. Other Verlinvest food-and-beverage deals include Epigamia Greek yogurt, hint flavored water and Vita Coco coconut water.

Jamjar, a London venture capital firm, has invested in Deliveroo, a U.K. food delivery service; ProperCorn, a popcorn maker; and Babylon, a health app.

Verlinvest and Jamjar could not be reached for comment.

Action Item: Contact popchips CEO Davis at +1 866-217-9327

Photo of popchips sour cream and onion flavor courtesy of popchips