Hain Celestial to sell international business to Aurelius
The transaction includes major food and beverage brands and is expected to leave Hain focused on its North American portfolio and debt reduction.
USA – Hain Celestial has reached a definitive agreement to sell its International business to global private equity firm Aurelius for approximately US$323 million in cash, as the company moves to simplify its portfolio and reduce debt.
Under the agreement, Hain expects net proceeds of between US$305 million and US$310 million. The company said the proceeds will be used to reduce debt following completion of the transaction.
The sale covers the majority of Hain’s International business and includes brands such as Ella’s Kitchen baby and kids foods, Joya and Natumi plant-based beverages, Hartley’s jelly, Linda McCartney Foods, Cully & Sully, Yorkshire Provender and New Covent Garden soups, among others.
Alison Lewis, Hain Celestial president and CEO, said the transaction would support the company’s strategy to streamline its portfolio and focus resources on debt reduction.
“Completing the transaction announced today would advance our strategy to simplify our portfolio and enable us to focus our resources on further reducing the company’s debt,” Lewis said.
“The resulting North American business would feature leading brands in attractive categories with a more streamlined operating model and greater focus on core growth opportunities,” she added.
Hain’s International business generated US$151 million in sales during the fourth quarter ended June 30, representing about 60% of the company’s quarterly sales. The U.S. business generated US$112 million in sales during the same period, according to Food Dive.
Following the sale, Hain’s North American portfolio will include Celestial Seasonings teas, The Greek Gods yogurt and Earth’s Best Organic baby and kids foods. Other brands include Spectrum Organic cooking oils, MaraNatha nut butters and Imagine broths.
Lewis said the simplified portfolio would allow Hain to concentrate its resources and management on its remaining North American operations.
“Looking forward, the simplified portfolio will allow us to concentrate our resources and management on the areas where we see the greatest potential to create value,” Lewis said.
Completion of the Aurelius transaction remains subject to Hain securing an amendment to its credit agreement with lenders. The amendment is intended to extend the company’s debt maturity date beyond December 22.
Under the agreement, Aurelius may terminate the transaction if Hain does not obtain the required credit agreement amendment within 30 days of signing. Hain said there can be no assurance that the amendment will be secured.
The company’s Board of Directors said extending the maturity date and completing the Aurelius transaction would be in the best interests of Hain and its stakeholders.
The agreement follows the Board’s continued strategic review, which has included evaluating alternatives and pursuing options intended to maximize value for stakeholders.
Once completed, the transaction will leave Hain focused on its North American business, with management emphasizing a more streamlined operating model and greater focus on its core brands and growth opportunities.
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