Hormel Foods Corp. and private equity firm Forward Consumer Partners struck a new strategic partnership Tuesday, wherein Hormel will relinquish ownership control of Justin’s, enabling the premium nut butter and snack brand to become a standalone company.
The details of the transaction, which is expected to be completed by the end of the year, were undisclosed.
Under the agreement, Forward Consumer Partners will own 51% of the company and Hormel Foods 49%.
Justin’s, which sells nut butters, confectionery and other snacks, was launched in 2004 as the brainchild of Justin Gold, who began by selling almond butters at the Boulder Farmer’s Market, the company said.
Justin time for growth
Gold sold the company to Hormel in 2016 for an estimated $286 million. The company grew rapidly in 2016 and was not actively pursuing a buyer, but Gold said at the time that Justin’s needed “additional resources for everything really, from creating safe, high-quality reliable products to sourcing raw materials, expanding our distribution and learning best-in-class strategies in marketing and HR.”
Then-CEO Peter Burns said in 2016 that the sale was driven largely by distribution constraints.
“Our No. 1 product is in fewer than 40% of grocery stores, and we have limited distribution in club, we have no real international business, no convenience store business and limited foodservice.”
That all changed under Hormel ownership.
Enter Hormel
“The Justin’s brand has always had incredible equity and passionate fans. We believe there is even more opportunity ahead,” said John Ghingo, president, Hormel Foods, in the partnership announcement. “Since acquiring the business in 2016, we’ve expanded its offerings to include a full range of almond and peanut butters, along with new varieties of peanut butter cups, almond butter cups and other confectionery products.
“This new partnership with Forward will build on that strong foundation, providing even greater focus and resources to help the business grow – while we remain invested in its success. It also reflects a broader strategy at Hormel Foods of finding creative ways to unlock the potential of all of our brands.”
Gold will return to the company as a strategic advisor and Justin’s board member, and Burns will return as CEO, according to Hormel.
“The Justin’s brand is a textbook Forward asset – a powerful brand that makes beloved products, with an enduring track record of success and significant untapped potential,” said Forward Consumer Partners founder and managing partner Matt Leeds. “We are grateful to partner with Hormel Foods, and we’re honored to be entrusted with the next chapter of the Justin’s brand story.”
