Wind Point Partners to sell Hearthside contract food manufacturer in US

Wind Point Partners has signed a deal to divest its portfolio company, Hearthside Food Solutions, to private investors Goldman Sachs and Vestar Capital Partners.

The move comes after Hearthside Food and Ryt-way Industries, another Wind Point portfolio firm, were merged in May 2013 to create an entity with over $1bn revenues and 19 production sites across seven states.

The financial terms of the transaction have not been disclosed.

Hearthside is a contract manufacturer and packager of grain-based food and snack products with a primary focus on bars, cookies and crackers, granola and cereals categories.

Wind Point gained control of Hearthside in 2009 in partnership with former Ralcorp Frozen Bakery Products president and ConAgra Foods veteran Rich Scalise, who heads Hearthside.

Scalise said that over the past five years Hearthside has more than tripled in size.

"We’ve broadened our product capabilities, significantly expanded our footprint to 20 facilities in eight states, and developed new customer relationships with high-growth, recognised consumer brands."

"Going forward, by leveraging the experience and relationships of both Goldman and Vestar, we are confident we can take the company to the next level of growth in the contract manufacturing industry," he added.

The transaction is expected to be concluded in second quarter of 2014, following which Goldman Sachs and Vestar Capital will own equal stakes in the food manufacturer.

Vestar CEO Dan O’Connell said, "Now more than ever, food companies turn to co-manufacturers like Hearthside to help them initiate and accelerate the commercialisation process and for timely response to changing consumer preferences."

Barclays provided financial advisory services to Wind Point Partners and Hearthside Food in connection with the transaction.

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Image: Hearthside Food Solutions focuses on granola and cereals, among other food categories. Photo courtesy of fotographic1980 at FreeDigitalPhotos.net.