Nutritional Outlook

Nutritional Outlook, December 2016

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NUTRITIONAL OUTLOOK ■ 49 December 2016 IVC Buys Perrigo's U.S. Supplements Little more than a week after the ink dried on the Iovate deal, China's International Vi- tamin Corporation (IVC), a vertically integrated consortium of nutritional ingredient suppliers and contract manufacturers, bought the U.S. supplements division of Dublin, Ire- land–based Perrigo, adding $40 mil- lion in revenue to its books, along with 300 additional employees, says Steinford. Notably, IVC retained Perrigo's existing U.S. management and hired locally to fll open positions, which Steinford claims is a "hallmark" of recent IVC and other Chi- nese acquisitions. "In addition to the new jobs created in the nutritional industry," he says, "the U.S.-manufac- tured products provided by IVC and other U.S. acquisitions are fnding their way back into China." Swander Pace Sells Renew Life to Clorox For a glimpse at how private equity plays matchmaker to an old-line consumer pack- aged goods company interested in a fresh- faced upstart (if almost 20 years in the di- gestive-health space still qualifes as "fresh"), look no further than Swander Pace Capital's May 2016 sale of gut-health innovator Renew Life (Palm Harbor, FL) to the Clorox Com- pany (Oakland, CA) for $290 million. As Tibodeau describes the deal, "You have an old standby CPG company that buys another company in our space—so that was a big transaction." What's more, Swander Pace's setup of the two lovebirds is a perfect illustration of what happens when "private equity invests and ultimately sells to a stra- tegic," he says. Finally, Renew Life's reputation as a probi- otic leader underscores the fact that "there's been a lot of interest in probiotics this year," Tibodeau adds. "It's gonna be a hot category." Swander Pace Swallows Big Te Renew Life sale wasn't Swander Pace's only big deal of the year. Te PE frm "made signifcant acquisitions in 2016 that to- gether form an entity far greater than they were individually," Steinford says. Getting things of to a strong start, Swander Pace bought Fargo, North Dakota–based Swanson Health Products in late January, acquiring what Steinford describes as "a top-fve U.S. nutrition- al supplement e-commerce/catalog retailer ofering over 27,000 products comprising both own-label and third- party oferings to consumers in fve coun- tries." And though the exact terms remain undisclosed, Steinford says that the deal "has been widely rumored to approach $700 million." Not more than a month prior, the com- pany targeted its investment sights on Captek Softgel International (Cerritos, CA), a softgel contract manufacturer that "adds to the existing Swanson manufac- turing, which previously lacked softgel capability," Steinford says. Speaking about the deal to BusinessWire, Mark Pof, a manag- ing director at Swander Pace, put it this way: "While the VMS category has strong growth, softgels are growing even faster due to their multiple end-use applications, high potency, and ease of swallowing, and we see Captek on the leading edge of that opportunity." Kimberly J. Decker writes for the food and nutrition industries from her base in the San Francisco area, where she enjoys eating food as much as she does writing about it. lighTspriNg/ "Few products are as readily accepted by Chinese consumers as U.S.-made dietary supplements," says Scott Steinford.

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