17 Apr 2019 --- The Campbell Soup Company has found a buyer for Bolthouse Farms. Butterfly, a Los Angeles-based private equity firm specializing in the food sector, has signed a definitive agreement to acquire Bolthouse Farms for US$510 million in cash, subject to customary purchase price adjustments. Upon completion of the sale, which is expected around July, Campbell will have divested its entire fresh division. The company says the sale of Bolthouse Farms allows it to better focus on its “iconic brands which have strong market positions.”

The deal comes after the long-established US snacks and soup company announced it was going through a strategic review last summer following a drawn-out period of falling sales. 

Bolthouse Farms Multi V Goodness Cherry Fruit Juice Smoothie (US)Campbell is renewing its focus on two core businesses in the North American market with a proven consumer packaged goods business model. 

As outlined in August 2018 as part of its board-led strategy and portfolio review, Campbell launched a thorough divestiture processes for both its Campbell Fresh and Campbell International businesses, with the aim to “maximize value,” significantly reduce debt and strengthen its balance sheet.

The process to divest Campbell International is still ongoing, notes the company, but remains “on-track” and there could be a buyer announced later this year. 

However, the divestment of Bolthouse Farms – a vertically integrated food and beverage company focused on developing, manufacturing and marketing proprietary, high value-added natural, healthy products – represents Campbell selling off its entire fresh division. 

Campbell recently signed a definitive agreement for the sale of Garden Fresh Gourmet to an affiliate of Fountain of Health US, a maker of hummus, dips, variety packs, prepared salads, pâtés and frozen desserts, for an undisclosed sum. The company also recently announced the sale of its Everett, Washington, refrigerated soup plant that was also part of Campbell Fresh. 

In the fiscal year 2018, Campbell Fresh recorded net sales of US$970 million. Proceeds from the divestiture of the Campbell Fresh businesses will allow the company to reduce debt by approximately US$570 million and the transactions are not expected to impact the company’s fiscal 2019 guidance, Campbell Soup reports the company reports. 

“The sale of Bolthouse Farms supports our strategy to focus on our two core North American businesses:, Campbell Snacks and Campbell Meals and Beverages,” says Mark Clouse, Campbell’s President and CEO.

Bolthouse Farms has leading market positions in fresh carrots and refrigerated premium beverages in the US, along with a strong and growing presence in refrigerated salad dressings. Bolthouse Farms benefits from access to more than 65,000 acres of premium growing land, nationwide fresh distribution capabilities and a state-of-the-art carrot and beverage processing facility. 

Founded in 1915 and California-based, Bolthouse Farms has approximately 2,200 employees and operates facilities in Bakersfield, California; Hodgkins, Illinois; Wheatley, Ontario; and Prosser, Washington.

This is Butterfly’s fourth investment within its “seed to fork” approach to investing in food across agriculture, aquaculture, food and beverage products, food distribution and foodservice. 

Butterfly Operating Partner Jeff Dunn will assume the role of CEO of Bolthouse Farms, wher he previously served as President and CEO from 2008 until 2012 when it was acquired by Campbell Soup Company. 

“We believe the company’s future is very bright especially given the continued rise of plant-based food in the diet of today’s consumer,” says Butterfly Co-Founder Adam Waglay. 

“We are proud to support Bolthouse Farms in further bolstering its strong positioning within fresh carrots and chilled premium beverages, adds Dustin Beck, Butterfly’s, fellow Co-Founder.

In August 2018, as part of its board-led strategy and portfolio review, Campbell launched a thorough divestiture processes for both its Campbell Fresh and Campbell International businesses. The process to divest Campbell International is ongoing, notes the long-established US snacks and soup company. 

At the time, Campbell’s interim President and CEO, Keith McLoughlin said the Board of Directors considered a full slate of strategic options, including optimizing the portfolio, divesting businesses, splitting the company, and pursuing a sale. 

“The Board concluded that, at this time, the best path forward to drive shareholder value is to focus the company on two core businesses in the North American market with a proven consumer packaged goods business model. importantly, the Board remains open and committed to evaluating all strategic options to enhance value in the future,” he says. 

By Gaynor Selby