YoCrunch Goes Up for Sale But PE Need Not Apply

Private equity may be interested in YoCrunch but they may not be able to bid for it.

Catterton Partners has put YoCrunch up for sale, several sources say. Houlihan Lokey is advising on the process, the persons say.

Greenwich, Conn.-based Catterton decided to talk to a limited number of parties after receiving inquiries from strategics about YoCrunch, a person says. However, the process is limited to strategics, the source says.

“YoCrunch is in the most attractive grocery category over the last three years,” a person says.

Naugatuck, Conn.-YoCrunch is known for creating the “dual cup.” One part of the cup contains yogurt in various flavors, while the other segment is filled with crunchy topping like granola or Reese’s pieces.

YoCrunch is believed to produce $20 million to $30 million of EBITDA, according to Merger Market, which reported the sale last month.

One banker says YoCrunch will likely sell to a regional dairy company like HP Hood, Dean Foods, Stremicks Heritage Foods or Grupo LaLa. The yogurt company could sell for 6x to 7x EBITDA, the banker says. However, a second banker says YoCrunch could go for more than 10x EBITDA.

YoCrunch’s profit is up nearly 50% year-over-year, persons say. Because of this, YoCrunch’s sale will likely be based on revenue multiples and not EBITDA, a different source says.

Catterton’s hiring of Houlihan also surprised some. Houlihan is seen as an IB that typically runs “processes that usually end up with a sponsor,” the second banker says.

Houlihan is known for its strong yogurt practice, sources say. In late 2010, Houlihan advised Swander Pace when it sold Liberte, an organic yogurt brand, to Yoplait. Houlihan, in late 2010, also advised Dean Foods when it sold Mountain High Yoghurt to General Mills.

Catterton declined to comment. Houlihan couldn’t be reached for comment.