Simply Good Foods Buys OWYN for $280M 💪

Welcome back to This Week in CPG, folks. Here’s what we’re covering this morning:

• L’Occitane likely going private 💰

• General Mills might divest yogurt biz 🥄

• SickScience launches 2nd product 💊

• CELSIUS stays hot 📈

• Acid League x Target 🎯

Shout-out to Numeral making e-commerce sales tax an afterthought.

Simply Good Foods Buys OWYN for $280M 💪

Simply Good Foods is shelling out $280M in cash to acquire OWYN, a leading ready-to-drink protein shake brand. OWYN, which is short for Only What You Need, markets RTD shakes and protein powders that are vegan, non-GMO, and free of the top nine allergens. The brand boasts an impressive retail roster — Kroger, Target, Walmart, Walgreens, Sprouts, etc. — and expects to finish 2024 with net sales of $120M. 

Co-founded in 2017 by husband-and-wife duo Kathryn Moos and Jeff Mroz, OWYN was quickly acquired by a group of investors led by Halen Brands and Clearlake Capital Group. In 2021, OWYN traded hands again when United Nutritional Brands purchased a majority stake in the brand.

Simply Good Foods, which trades on the NASDAQ under the ticker SMPL, owns two very popular nutrition brands: Atkins and Quest. Simply Good Foods was formed in 2017 in order to acquire NCP-ATK Holdings, otherwise known as Atkins. Two years later, they purchased Quest for $1B. 

Despite only owning two brands, Simply Good Foods is a large business with over $1.2B in annual revenue and $133M in net income. In 2023, Atkins contributed $526M in sales while Quest generated $682M. 

The acquisition of OWYN is a good deal for Simply Good Foods for a number of reasons:

• OWYN is a third, complementary brand that further diversifies their portfolio

• OWYN offers greater exposure to the fast-growing RTD protein shake category

• They’re paying 2.3x estimated net sales or 13.3x estimated adjusted EBITDA so it’s not a terribly expensive deal

• There are considerable manufacturing and distribution synergies to drive EBITDA

• Right now OWYN is a pure play beverage brand, so there are ample category expansion opportunities (protein bars, protein snacks, etc.). Look how far Quest has come since being acquired in 2019 👇

More on the transaction here.

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Deals 💰

Mergers & Acquisitions 

• If all goes to plan, Austrian billionaire Reinold Geiger is taking L’Occitane Group private. Geiger, who already owns more than 70% of the global beauty firm, submitted a €1.7B bid to buy the remainder of the company and delist from the Hong Kong Stock Exchange. L’Occitane Group owns a number of beauty brands like Sol de Janeiro, ELEMIS, L’Occitane en Provence, and others. H1 2024 sales jumped 18.5% to $1.17B. WSJ

• Minneapolis-based food conglomerate General Mills is considering a $2B sale of its yogurt business. Their yogurt brands include Yoplait, Oui, and Liberté. The unit generates annual EBITDA of around $250M. IMO the most likely buyers are Platinum Equity, Advent International, or Yellow Wood Partners. Reuters

What’s New 🤩

Apparel, Cosmetics, and Wellness

• SickScience, a recently launched biotech beauty brand, launched their second product — PowerCycle. PowerCycle is a scalp care product that promotes hair growth, maintains keratin levels, and improves tensile strength. WWD

• Evangelo Bousis, the co-founder of Dundas Beauty, launched a men’s skincare brand called Enhanse. The line is available on their website and via Amazon. The packaging is sleek. Glossy

• Goop Beauty launched a new product just in time for summer — Summertone Bronzing Gel. The product is available online for $38. Happi 

• New York-based fragrance brand Snif is launching a new scent, Coco Shimmy, on May 2nd. Snif’s cartons are always absolutely stunning. Tart Deco is a personal favorite. Instagram

Food, Beverage, and Alcohol

• UK-based beverage brand TRIP released a new line called Mindful Blend which features Lion’s Mane, L-theanine, magnesium, and ashwagandha. Four flavors are currently available: Cucumber Mint, Blood Orange Rosemary, Elderflower Mint, and Raspberry Orange. Instagram

• It appears that BFY soda brand Rad Soda is relaunching with a whole new look. The retro branding is unbelievably good. Shout-out to Mark Gallo for always sourcing great beverage news. Twitter

• Late to this but Crystal Head Vodka is launching a line of RTD cocktails. Two flavors are available: Cosmopolitan and Espresso Martini. Forbes

• An exciting brand that I’m hearing a lot about is Fruit Riot. They take frozen fruit and cover it in sour candy coating. Kinda genius. Apparently they’re frequently selling out at Albertsons, Walmart, and Sprouts. The branding is brilliant 👇 Fruit Riot

• BlueTriton Brands is releasing aluminum bottles for a number of their top bottled water brands like Arrowhead, Pure Life, Poland Spring, and others. PR Newswire

• Plant-based nutrition brand Misfits launched a range of protein bars that have a softer texture and bolder flavor. Instagram

Data 🖥️

• Per NielsenIQ, CELSIUS volume shot up 63% for the four weeks through April 6th, while C4 Energy volume jumped 38.8% over the same period. Twitter

Distribution News 🚚

• Acid League launched three of their salad dressing SKUs at Target.

• Supergut announced a new retail partnership with GNC.

• Muddy Bites launched two more SKUs nationwide at Walmart.

• Kylie Cosmetics launched at 25 Sephora stores throughout India.

• Functional beverage brand Illicit Elixirs launched at Life Time Fitness.