Dive Brief:
- Hain Celestial Group sold its Westbrae Natural brand to Bush Brothers & Company. Details of the transaction were not disclosed.
- Mark Schiller, Hain’s CEO, said in a written statement the divestiture of the non-strategic asset helps simplify the company’s portfolio while improving its growth profile, margins and cash flow.
- Schiller has spent much of his tenure at the organic and natural food products company offloading several businesses — including ones slaughtering turkeys and selling fresh fruit — to focus on its core offerings.
Dive Insight:
Schiller took the helm in November 2018, as the manufacturer of Celestial Seasonings teas, Greek Gods yogurt and Sensible Portions Garden Veggie Straws was in turmoil.
A major part of Schiller’s time was spent stabilizing the business and divesting brands such as Tilda rice, Arrowhead Mills baking products and poultry brand Hain Pure Protein to focus on the most profitable and best-selling lines.
Hain announced last month that Schiller will step down at the end of the year. But just two weeks before his departure, Schiller is making one final sale.
Westbrae Natural, a line that includes organic pinto, kidney and garbanzo beans, was acquired 25 years ago amid a growth binge by Hain. The growth-at-any-cost mentality supercharged sales, but left Hain with a disparate group of brands in 37 different categories and a portfolio with little coherence.
With this sale, Hain unloads a product that doesn’t fit with its chips, yogurt and teas. “The transaction allows us to focus more resources on driving distribution and expanding innovation on priority brands,” Schiller said.
A sale to Bush immediately gives the iconic bean company a deeper presence in organics while expanding its reach in a category it is best known for. It also potentially gives Bush an opportunity to squeeze synergies from the overlapping businesses.
The sale for Hain is unlikely to be its last.
Hain has long faced questions about whether it should sell its personal care portfolio of cleansers, shampoos, sunscreens, lotions and baby care products. These take away from its food products and make up less than 10% of Hain’s total sales.
Further pruning of Hain’s businesses could make the company’s natural and organic food and beverage portfolio, popular among consumers looking to eat healthier, a more attractive acquisition target for a big CPG looking to broaden its presence in the better-for-you space.
