Castillo Hermanos has struck a deal to buy SunnyD maker Harvest Hill Beverage Company from private-equity firm Brynwood Partners.
The companies did not disclose the financial terms of the “definitive agreement” in a statement but, Reuters, citing sources familiar with the matter, reported the deal is valued at approximately $1.5bn, including debt.
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In the statement, the Guatemalan conglomerate said the deal “significantly expands” its footprint in the US, providing a platform to scale its operations in the country.
Castillo Hermanos CEO Roberto Lara said: “This is a key moment in our history as we set out to meaningfully expand our reach into the US.”
The Central American firm has joined forces with US private-equity firm Centerview Capital, which has made an “significant” investment and will serve as a partner in expanding its beverage operations in the US.
Set up in 1886, Castillo Hermanos is a family-owned business operating in diverse sectors, including beer and non-carbonated beverages, with brands such as Gallo Beer and Raptor Energy Drink.
“Our trusted and iconic brands, combined with Harvest Hill’s, offer a compelling product assortment to cater to diverse consumer needs,” Lara added.
Harvest Hill was founded in 2014 following Brynwood Partners’ acquisition of the Juicy Juice brand from Nestlé.
According to Harvest Hill president and CEO Robert Mortati, the two companies’ “strategic visions are aligned”.
“Together, we will be able to scale our businesses, enhancing the presence of our brands across the beverage marketplace,” he said.
Since its inception, Harvest Hill has grown through acquisitions, adding American Beverage Corporation from Wessanen in 2015, Sunny Delight Beverages Company from JW Childs in 2016, and Nutrament from Nestlé in 2016.
Its portfolio includes Juicy Juice, SunnyD and adult beverage brands such as Daily’s.
Harvest Hill runs six manufacturing facilities across the US, with its products available through “all major” distribution channels, Brynwood Partners said.
Additionally, Castillo Hermanos plans to introduce its drinks from its Maravilla business unit to the US, including the Del Frutal juices brand and lowering production and distribution costs by manufacturing in the country as opposed to importing.
Harvest Hill employs more than 1,000 staff, including its management team, and all are expected to retain their positions, joining Castillo Hermanos’ workforce of over 20,000, the new owner said.
