Stephen Bronfman's Claridge Inc. is hungry for more food and beverage deals after selling frozen meal business Les Plats du Chef last summer, its last remaining holding in the sector.
The Montreal-based private equity firm is once again seeking investment opportunities in mid-market food and drink companies as it seeks to replenish its stable of comestibles. It says future investments will target entrepreneurial firms in both Canada and the United States, especially those tied to growing trends in nutrition, health and wellness.
"We're looking to get back in," Mr. Bronfman said in an interview Wednesday, declining to provide a figure on how much new capital is being committed. "Having done some good positive deals in the space has left us with a really good taste and also I think with a decent name in the business."
Food and drink is in the Bronfman bones. The family built Seagram Co. Ltd. into one of the world's biggest liquor empires in the 1990s before the company imploded after a series of questionable business decisions. It was an outcome his father, Charles, would later sum up as "a family tragedy."
Claridge has invested nearly $300-million over the 20 years it has been in food and drink. Revenues from its portfolio companies, which ranged from $8-million to $108-million at the time of initial investment, have ballooned on average by six times under its ownership, according to Claridge. Its focus is on driving sustainable growth through a long-term vision; it holds an asset nine years on average.
One of its longest holdings was Plats du Chef, a Montreal-based maker of frozen snacks, soups and meals. For 15 years, Claridge helped Plats founders Michel and Monique Lachapelle expand through acquisitions and develop products for clients before the business was sold to C.H. Guenther & Sons Inc. last summer for an undisclosed amount.
Other past holdings include SunOpta, a specialty food supplier; Glutino, the continent's biggest gluten-free-food company; and La Terra Fina, a maker of dips and quiches.
Claridge prefers to partner with a business's founders rather than own it outright. It likes to get involved, both by giving advice and taking board representation, although it leaves the day-to-day operations to management.
North Americans are seeking authenticity in food and they're looking for fresher and minimally processed food brands, according to Mr. Bronfman. He cites the growing popularity of meatless foods and protein replacement.
Impossible Foods is one company active in this space. The Silicon Valley startup sells burgers made from plants that attempt to recreate the same experience a beef patty delivers, from the sizzle it makes when cooking on the grill to the juice it bleeds. Among its investors is Bill Gates.
"With technology advancing rapidly and the growing demand, 2018 will be a year where engineered foods, specifically plant-based foods, will take a huge step forward," Caleb Backe of Maple Holistics told HuffPost Canada last month.