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Solera Capital Acquires Majority Interest In Annie’s Homegrown, Inc. From Homegrown Natural Foods, Inc.

Submitted by: Annie's Homegrown

Categories: Corporate Governance

Posted: Aug 13, 2002 – 12:00 AM EST


- Provides Means to Expand Annie’s Distinctive Brand Into New Markets, New Products
- HomeGrown to Invest in Growth of its Consorzio' and Fantastic Foods' Brands, Pursue New Opportunities -

Aug. 13 /CSRwire/ - NEW YORK, New York, NAPA, California, and WAKEFIELD, Massachusetts - Solera Capital has acquired a majority interest in Annie’s Homegrown, Inc., a leading natural and organic food brand in the United States, from HomeGrown Natural Foods, Inc., the companies announced today. As part of the transaction, Solera will invest additional growth capital in Annie’s, and Annie’s management and HomeGrown Natural Foods have retained a minority stake in the company. Financial terms of the transaction were not disclosed.

Founded in 1989, Annie’s Homegrown is a pioneering company in the natural and organic food industry, best known for its macaroni & cheese products. With its intensely loyal, grass-roots following, Annie’s is easily recognized in supermarkets by its flagship “purple box” packaging and its much adored mascot, “Bernie the Bunny.” Since its inception, Annie’s has become the fastest growing brand in the pasta meals category, and its product line now includes over 25 different varieties of natural and organic pasta products. In the past three years, Annie’s has made significant advancement into mainstream supermarkets, its sales have increased at a compounded annual growth rate of approximately 27%, and it has been profitable. Throughout its history, the 13-year-old company has been recognized for its commitment to providing great-tasting products, as well as supporting its social goals of healthy, responsible and environmentally friendly living.

Solera will work closely with Annie’s management team, including chief executive officer Paul Nardone and founder Ann Withey, to further broaden distribution of Annie’s core products from the natural and organic markets to the mainstream supermarket channel, as well as to introduce new products under the Annie’s brand. It was also announced today that Tim Fallon, chairman and chief executive officer of Vermont Pure Holdings, Ltd., has joined Annie’s board of directors, and that John Foraker, chief executive officer of HomeGrown Natural Foods, will continue to serve as a director.

Molly Ashby, chief executive officer of Solera Capital, said: “We welcome the Annie’s Homegrown brand to the Solera Capital portfolio. Solera’s investment in Annie’s is consistent with our strategy of investing in category-leading brands in markets poised for significant growth. Natural and organic food is one of these markets. We are excited to work with the dedicated Annie’s team that shares our commitment to expanding the already impressive market reach of the Annie’s brand while maintaining the authenticity that so powerfully touches Annie’s consumers.”

Ann Withey said: “Solera is an ideal partner for Annie’s. I’m confident that they will help us continue to build a business founded on great values and a real appreciation for the needs of its customers, employees and the communities in which it operates.”

“Our partnership with Solera will enable us to accelerate our progress in growth areas and further expand our leadership position in the pasta meals category,” Mr. Nardone said. “We have great opportunities before us, and Solera brings added talent and resources that will help us get there. We are proud to welcome them to the Annie’s family.”

Mr. Foraker said: “Natural foods are growing considerably faster than the overall food industry. Annie’s, Fantastic Foods and Consorzio are strong brand names that consumers trust and all have tremendous potential in this dynamic market. In addition to providing new capital and resources to Annie’s, this transaction positions HomeGrown Natural Foods for significant growth. It enables HomeGrown Natural Foods to focus its resources on continuing the double-digit revenue growth of its profitable Consorzio and Fantastic Foods brands, and provides capital necessary for us to pursue other complementary acquisitions in the natural food industry. We will continue to build on our reputation for providing high-quality products as we expand to meet the growing demand for natural foods."

The organic food sector is forecasted to grow at a rate of 20-25% and the natural food sector is expected to grow 8-10% over the next several years, compared to 1-2% projected for conventional food, according to industry experts. Several important attitudinal and demographic trends are fueling the growth of both sectors: an aging population increasingly interested in healthy eating and quality food products, government regulation, and an increased understanding of the harmful effects of pesticides, food additives and genetically engineered ingredients.

About Annie’s Homegrown

In 1989, Annie Withey, the creator of Smartfood snack products, had an idea that her recipe for an all-natural macaroni & cheese dish might catch on with consumers looking for healthy and flavorful meal alternatives. Annie’s HomegrownÒ is today, the fastest growing natural and organic macaroni & cheese brand in the United States. In 1998, the company introduced three kinds of organic macaroni & cheese, which quickly became best sellers thanks to consumers’ interest in organic products. Annie’s now sells more than 25 kinds of macaroni & cheese. Annie’sÒ products, in their distinctive bright colored boxes -- each bearing the likeness of Annie’s pet rabbit, Bernie, who lives with her on her Connecticut farm -- can be found not only in natural and organic food stores throughout the country, but in a growing number of supermarkets as well.

Annie’s success is inextricably intertwined with its public mission: to make the very best tasting and highest quality natural food products for its customers; to support and encourage people to make a commitment to our planet and the people who live on it; and to be a role model to other corporations by showing the moral and financial benefits of being responsible World citizens.

Annie’s Homegrown is based in Wakefield, Massachusetts. The Company’s website is located at www.annies.com.

About HomeGrown Natural Foods

HomeGrown Natural Foods, Inc. was founded in 1999 as a platform to purchase, consolidate and grow high-quality, branded companies in the natural foods industry. The company is engaged in acquiring, consolidating and building high-quality brands under the HomeGrown umbrella.

More information on the Company can be found at www.homegrownnaturalfoods.com.

About Solera Capital

Solera Capital, LLC is a New York City based private equity firm founded in 1999.

For more information, please contact:

Dawn Dover/Mark Semer Solera Capital
Phone: (212) 521-4800
Paul Nardone Annie’s Homegrown
Phone: (781) 224-1172


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