Hearth side Food Solutions, one of the largest contract food manufacturing companies in the US and the country’s largest independent, privately-owned bakery in the country, has recently just got new owners.
An investment group, with Charlesbank Capital Partners and Partners Group at the helm, has reached an agreement with Hearthside owners Goldman Sachs and Vestar Capital Partners, which gives the group ownership of the Illinois contract food manufacturing company. The details of the financial transaction was not revealed, though it has yet to be finalized.
Upon finalization, Charlesbank and Partners Group will gain operational rights. According to them, they already have plans for collaborating with Hearthside’ management team for several value creation initiatives. Rich Scalise, Co-Founder, Chairman and CEO of Hearthside says that they are excited to welcome Charlesbank and Partners Group as new partners moving forward, and that Hearthside is thankful to Goldman Sachs and Vestar for their cooperation and support over the last couple of years.
Managing Director for Private Equity in Americas for the Partners Group, Chris Russell, says that the group has faith on Mr. Scalise and his ability to lead Hearthside’s operations. He says that they see a lot of potential for the company to grow as its business model is built on being flexible and adaptive to global trends, like the recent increase in outsourcing, which they say won’t slow down anytime soon.
Notably, there have been rumours prior to the news that Hearthside was up for sale, when a report published by Bloomberg in January says that Hearthside would be worth around $2.5 billion to acquire, an increase from the value that Goldman Sachs and Vestar acquired it back in 2014; $1.1 billion.
Goldman Sachs’ Nicole Agnew expressed pride in Hearthside, calling it an exceptional contract food manufacturing platform, and saying that the firm was happy to have been able to help Hearthside grow in Europe and across high-growth categories. Meanwhile, Vestar Managing Director Brian O’Connor says that Hearthside’s growth in the past four years was above the expectations they set for the food company.
Mr. O’Connor added that he, and Vestar, are quite confident in Hearthside’s capabilities, and that they expect the company to grow and prosper under the ownership of Charlesbank and Partners Group.