Protein powerhouse Glanbia shakes things up with $350m acquisition of Slimfast
Irish nutrition firm, Glanbia, has confirmed it has signed a deal to buy popular diet milkshake brand Slimfast for $350m (£264.9m) from US private equity firm, Kainos Capital.
The weight management business was bought by Kainos Capital from Unilever in 2014. Today’s deal is just a fraction of the $2.4bn Unilever paid for Slimfast in 2000.
Already one of the world’s largest producers of nutritional products such as whey protein, Glanbia said it will distribute Slimfast within its performance nutrition segment as it seeks to capitalise on the brand’s established presence in the UK and US.
Slimfast’s gross assets were worth $136m at the end of 2017, when the brand posted a net loss before tax of $12m. Additional supplement brands including Healthy Delights and Nu-Therapy will also join Glanbia as part of the deal.
Glanbia’s group MD, Siobhan Talbot (left), said the deal was executed as part of its strategic expansion of its performance nutrition division, as customer demand for protein and fitness diet products rises.
Kainos managing partner, Andrew Rosen, said: “Our acquisition of SlimFast came with no employees or systems. Behind the leadership of chief executive, Chris Tisi, who we partnered with when we invested in his company HNS in 2014, we quickly built a 60-plus person team in the US and the UK.
“This team, combined with our own internal resources, did a great job revitalising what was an orphan brand within a large multinational company. SlimFast is positioned to continue its great success as a part of Glanbia.”
Davy analysts, Cathal Kenny and Roland French, said the deal was Glanbia’s most significant since its 2008 purchase of Optimum Nutrition, the world’s best-selling whey protein brand to gym-goers.
“It is the first time that Glanbia has acquired a storied brand with mass awareness,” the Davy analysts said, adding that they expect the Irish group to boost SlimFast with its own innovation and expertise, which should sustain “the continued rejuvenation of the brand”.
Martin Deboo, an analyst at Jefferies International, said: “Those with long memories will recall Unilever’s acquisition of SlimFast in 2000, its history of subsequent writedowns and its ultimate sale by Unilever to Kainos Capital in 2014.
“What was different then was that Unilever paid nearly 4x sales (according to contemporary press reports) for a business that was about to be blindsided by the Atkins diet.
“Now SlimFast has around a third of the sales that it did then and has diversified its heritage local proposition into protein, energy and ketogenic nutrition.”
The deal is expected to close before the end of the year, subject to regulatory approvals.
Source: Irish Independent, just-food.com