USA- Kansas-based Alphia, a pet food manufacturer with milling, manufacturing and logistics capabilities, is considering a sale, but no final decision has been reached, according to a story by Reuters.
According to the report by Reuters, quoting unnamed “people familiar with matter” the private equity-owned manufacturer is said to be working with investment bank Goldman Sachs on a potential deal.
These sources hold that the potential deal could value the company at more than US$1bn.
Alphia makes kibble, treats, and canned food for third parties and also owns the animal nutrition products maker Lani, which was previously known as Lortscher’s Animal Nutrition.
Alphia also owns Veracity Logistics, an AIB-certified, food-grade warehousing and logistics provider that provides quality traceability throughout distribution/supply chains.
The company, which is owned by Connecticut-based J.H. Whitney & Co, was formed out of the merger of pet-food manufacturers C.J. Foods and American Nutrition in 2020.
At the time, C.J. Foods had more than 35 years of experience in superpremium pet food manufacturing with a range of international capabilities serving superpremium brand owners and retailers.
On the other hand, American Nutrition Inc produced extruded, baked and canned pet foods and treats for domestic and international distributio, and had been doing so since 1972.
Acquisitions trend in petfood industry
While the Alphia sale is yet to be confirmed, the pet-food category has seen some significant deals of late, with pet food companies attracting generous offers from potential buyers, amid a worldwide shortage of pet food due to increased demand and supply chain issues.
including Post Holdings entering the market in February this year by acquiring several brands from local manufacturer J.M. Smucker in a transaction said to be worth around US$1.2bn
Another notable deal in recent years include General Mills Inc’s’ acquisition of Blue Buffalo Pet Products Inc for nearly US$8 billion.
General Mills, however, recently announced plans to close down the Blue Buffalo pet food manufacturing plant in Independence, Iowa, by the end of this year, potentially putting more than 200 jobs in jeopardy.
Other acquisitions that continue to drive growth include Mars Petcare’s acquisition of Champion Petfoods, and Clearlake Capital Group’s takeover of Wellpet.
Last October, US activist investment firm Third Point urged Colgate-Palmolive Co. to divest pet-food business Hill’s Pet Nutrition.
During this last quater, this pet food business delivered another double-digit net and organic sales growth “despite a difficult comparison,” with its sales making up 22% of parent company Colgate-Palmolive’s US$909 million in sales for the quarter that ended March 31.