Clearlake launches health food fund

The US investment firm has also acquired non-genetically modified organised food company That's How We Roll.

US investment firm Clearlake Capital Group has launched a fund to invest in healthy food and other “wellness” companies.

The firm also acquired non-genetically modified and monosodium glutamate-free packaged food company That’s How We Roll (THWR) through the Better for You Holdings platform.

Better For You is a partnership with private health foods investment and operating company Halen Brands on a financial and operational basis. Halen, which was formed last year, is a former investor in THWR brands Dippin’ Chips and Mrs Thinsters.

Clearlake has historically targeted investments in technology, communications, industrials, energy, and onsumer products.

Clearlake principal Arta Tabee singled out THWR’s “supply chain capabilities” in a statement. Non-genetically engineered foods is a sub-sector in the US packaged foods market, and commands price premiums. Less than 10 percent of US corn and soy is produced organically, creating supply chain challenges for organic processed food companies.

THWR founder Aldo Zuppichini will remain as chief executive and has retained a significant equity stake in the company. THWR will use the investment from Clearlake to expand the company’s sales and production operations.

“Clearlake’s partnership will allow us to extend our resources for product innovation, accelerate nationwide distribution, and provide consumers with more premium healthy snack options without sacrificing taste,” said Zuppichini.

Clearlake Capital Group was founded by Steve Chang, Behdad Eghbali and José Feliciano in 2007 in partnership with Reservoir Capital Group. The firm’s investment approach integrates private equity, leveraged finance and special situations in private and public market investment opportunities. The firm reached a final close on $1.38 billion for its most recent fund Clearlake Capital Partners IV last year, according to PEI Research and Analytics.

Investors in the fund include institutional investors such as the Los Angeles County Employees’ Retirement Association, New York State Teachers’ Retirement System and Illinois State Board of Investment.