The initial purchase price for the transaction is $180m in cash and is expected to close in Q1 2021.
Built on a mission of supporting farmers, Wholesome holds a 76% share of the organic granulated sugar segment in the organic and natural channel in North America, according to SPINS retail sales data. Retail sales for Wholesome and its portfolio of organic, plant-based, and fair-trade sweeteners – which includes sugar, honey, agave nectar, allulose, and other liquid sweetener products – have grown 52% over the 52-week period ending Nov. 1, 2020.
Albert Manzone, Whole Earth Brands CEO, said the deal will bring additional scale to Whole Earth Brands’ existing portfolio of sweeteners and marks the second acquisition the company has made in this category this year (last month the company acquired US sweeteners and baking mixes firm Swerve for $80m).
“Wholesome’s leading position in organic sugar, honey, agave and allulose is a perfect complement to our existing portfolio of natural and alternative sweeteners… we are excited about the platform we are building across the sweetener category in North America,” said Manzone.
Organic sugar and sweeteners
Wholesome’s business – which is the single largest importer of organic sugar in the US – provides Whole Earth Brands with a stronger foothold in the large and growing organic sugar category. According to Nielsen sales data (52 weeks ended 9/26/20), organic sugar consumption is growing at 1.5x rate of conventional sugar.
With the recent acquisition of Wholesome – which includes its branded retail, ingredients, and private label businesses – Whole Earth Brand’s share in the North American natural sweeteners category is estimated to increase by 2.8 points to 14.5% and creates a sweeteners platform which is expected to generate approximately $500m in revenue in 2021.
“Wholesome has deep and tenured customers who are the market leaders across diverse food retailing and consumer products channels. The expanded portfolio of brands significantly improves the company’s shelf presence and visibility with retail customers,” stated Whole Earth Brands’ management team.