Deals

Partners Group, Charlesbank to pay $2.4bn for the US’s largest independent baker

The two PE firms will own an equal share in Hearthside, a portfolio company of Goldman Sachs and Vestar.

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Switzerland’s Partners Group and Boston-based Charlesbank Capital Partners have agreed to buy Hearthside Food Solutions, a company they bill as the US’s largest independent bakery.

The pair will acquire the asset from Goldman Sachs and Vestar Capital Partners as 50/50 partners. Transaction value was not disclosed but Agri Investor understands the deal to be worth around $2.4 billion, including debt.

Based in Downers Grove, Illinois, Hearthside produces nutrition bars, cookies, cereals and other baked goods for global food brands such as Kellogg’s and PepsiCo. It runs 25 factories across the US and Europe and employs about 7,900 staff.

Partners Group is funding the deal through a mix of pooled funds and separate accounts, including the Partners Group Direct Equity 2016, a spokeswoman for the firm told Agri Investor. That vehicle reached a close on €3 billion in February.

She underlined that the firm does have a track record in investing in food-related businesses, though she declined to disclose a list of such deals.

One known example is Hofmann Menü Manufaktur, a German company that makes cooked and frozen meals for the likes of retirement homes, hospitals and schools which Partners Group bought in 2013.