Park City’s Nutraceutical International Corp. has been acquired by HGGC LLC, a middle-market private equity firm based in Palo Alto, California. The transaction is valued at approximately $446 million, including debt to be refinanced, according to a release from HGGC. Under the terms of the agreement, Nutraceutical stockholders will receive $41.80 in cash for each outstanding share of Nutraceutical common stock they own, which represents a 49 percent premium to the company’s closing stock price on May 19 and a 15.6 percent premium to the company’s all-time high closing stock price.
“We are pleased to announce this transaction, which delivers significant value to our stockholders, many of whom have been with us since our initial IPO in 1998,” said Bill Gay, chairman and CEO of Nutraceutical. “We are excited to be joining forces with HGGC, which is a world-class private equity firm. HGGC’s expertise in formulating strategic growth plans for middle-market companies will be a great platform for the future of Nutraceutical. We expect that the combination of HGGC’s strategic insights and the deep industry experience and knowledge of our management team will help us continue to build and grow. We remain committed to our employees and their families, to our customers, to our worldwide consumers and to the natural products industry. We especially want to thank our employees for their years of dedication and hard work.”
Rich Lawson, cofounder and CEO of HGGC, said, “We congratulate the management team and employees of Nutraceutical for building an industry-leading nutritional supplement business, and we look forward to working with the Nutraceutical team to continue to pursue growth opportunities globally.”
“Nutraceutical is an impressive company with a diverse portfolio of brands and thousands of satisfied retail customers, as well as millions of loyal consumers who rely on its products,” said Les Brown, managing director and chief operating officer of HGGC. “Nutraceutical is a great example of a successful roll-up strategy carried out with consistency and dedication over the last 25 years. We have long admired their disciplined market approach, which has allowed the company to consistently generate strong financial returns and positive cash flow.”
The agreement has been unanimously approved by Nutraceutical’s board of directors, acting on the recommendation of a special committee of independent and disinterested directors.
Nutraceutical is a manufacturer, marketer, distributor and retailer of branded nutritional supplements and other natural products sold primarily to and through domestic health and natural food stores. Internationally, Nutraceutical markets and distributes branded nutritional supplements and other natural products to and through health and natural product distributors and retailers. Nutraceutical owns neighborhood natural food markets, which operate under the trade names The Real Food Company, Thom’s Natural Foods, Cornucopia Community Market and Granola's. Nutraceutical also owns health food stores, which operate under the trade name Fresh Vitamins.
HGGC is a middle-market private equity firm with over $4.25 billion in cumulative capital commitments.