Confectionary, food and beverage conglomerate Kraft Foods is selling part of its natural food products line, Back to Nature, to private-equity firm Brynwood Partners.
While Kraft has sold two other brands to Brynwood, it’s keeping a minority stake — reported to be between a quarter and a half, according to Dow Jones— in the Back to Nature line, which currently includes crackers, cookies, granola and trail mixes that contain less-processed ingredients.
Brynwood Partners focuses on acquiring smaller, overlooked brands from large corporations, and has acquired three dozen from various corporate sellers, including two other brands from Kraft. Though the financial terms of the Back to Nature deal were not disclosed, Brynwood Partners typically acquires brands for less than $125 million.
Kraft will have board representation in the joint venture held between the two companies, but Brynwood will manage everyday affairs.
"Back to Nature does not have the kind of scale for us that will get it the resources that could get it the growth that it should," Kraft spokesman Michael Mitchell said.
Brynwood senior managing partner Henk Hartong III plans to bring more new products and more focused marketing to Back to Nature, seeing potential for expansion into salty snacks and frozen foods.
Back to Nature’s sales are between $50 million and $75 million a year, but its sales of cookies, crackers and trail mix have seen a 20% annual boost over the past three years, Mitchell said.
Once Kraft spins off its North American grocery business, Kraft Foods Group, on Oct. 1, its Back to Nature stake will become part of Kraft’s global snacks company Mondelez International. Kraft Foods Group will also be selling the Back to Nature macaroni and cheese product under a licensing deal.