The business, which was founded by Edgar Dalmiro Diaz in Dallas, Texas, in 2010, was acquired in early 2013 by investors including Brian Twomey (the restaurateur behind The Common Table and the Marquee Grill), who spoke to us last month (click HERE) about how the mellow-tasting, ultra-thick brand was attempting to carve out a niche in the increasingly crowded Greek yogurt category.
While Whole Foods and other natural chains were increasingly looking for organic, non-GMO and grass fed premium dairy products, Twomey said retail buyers had been enthusiastic about Three Happy Cows' new culinary inspired flavors:
“Retailers that we have shown them to have been incredibly supportive and enthusiastic about what we are trying to do. We’re mostly concentrated in Texas - in around 400 stores like Randalls (Safeway) and Central market (HEB), but we’ve just picked up a few chains in the Chicago market including Jewel Osco.”
We discontinued producing yogurt at the end of January
However, on Tuesday afternoon, after FoodNavigator-USA contacted Twomey (director of marketing at the firm) to get his comments on reports that Three Happy Cows had stopped operating, we received an email from the corporate affairs department at Tyson Foods (which acquired the brand in 2014), which said: “In order to focus on our core businesses, including the growth of our prepared foods business following a major acquisition [of Hillshire Brands] last year, we discontinued producing yogurt at the end of January.”
The revelation came shortly after Diaz was fined $1.5m and sentenced to five years in prison for intentionally setting fire to the company's old factory at 2750 Northhaven Drive, northwest Dallas, in March 2013, which according to local press reports, he did in a fit of passion because he felt the business was going in the wrong direction under new ownership.
(The Three Happy Cows brand was off the market for just under a year while its new owners found co-packers in Los Angeles to produce the product and developed new recipes and packaging.)
Diaz intentionally set fire to that building
According to a press release from the U.S. Department of Justice, Northern District of Texas, “Diaz pleaded guilty in January 2014 to an indictment charging one count of malicious use of explosive materials…
“According to documents filed in the case, in mid-March 2013, Diaz intentionally set fire to that building [the Dallas factory]. At that time, businesses located in the building were engaged in activities that affected interstate commerce, and the fire Mr. Diaz set damaged the building and its contents.”
New owners moved away from using organic, grass fed milk
So what went wrong?
One source close to the company told FoodNavigator-USA that Tyson Foods was not a great fit for the Three Happy Cows brand, which had moved away from its roots. “Tyson obviously don't know or understand the dairy business...or especially organic or Non- GMO food.”
Twomey did not respond to emails but a spokesman at Tyson told us: "We acquired the business last year. For competitive reasons, we’re not in a position to discuss the matter further."
More to follow…