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Compass Diversified to buy hemp food brand

Published June 9, 2015

WESTPORT, Conn. (BRAIN) — Compass Diversified Holdings, the owner of Camelbak, has agreed to buy Fresh Hemp Foods Ltd., a Winnipeg, Manitoba, company that markets hemp-based foods under the Manitoba Harvest brand.

Manitoba Harvest products are carried in about 7,000 retail stores across the U.S. and Canada; last year it reported net revenue of approximately $37.9 million Canadian ($30.7 million)  an increase of 24 percent year-over-year. 

Compass will pay $133 million for the company. Compass' initial equity ownership will be approximately 87 percent . Mike Fata, the CEO of Manitoba Harvest; Clif White Road Investments LLC, an existing shareholder; and other management team members will re-invest alongside Compass. 

"We are pleased to capitalize on our balance sheet strength and add Manitoba Harvest to our family of niche leading businesses," said Alan Offenberg, the CEO of Compass Diversified Holdings.

"Consistent with our previous platform acquisitions of leading branded consumer businesses, Manitoba Harvest possesses several qualities critical for success. Specifically, the company is a leader that operates in a large and expanding marketplace, has strong and growing cash flows, a passionate consumer following, an experienced management team and compelling expansion opportunities.

"Under the leadership of Mike Fata, the company's innovative founder and a thought leader in the hemp-based foods industry, Manitoba Harvest has developed a strong and defensible market position with a loyal customer base and a substantial presence at major retail and online stores. We look forward to working with Mike and his team at Manitoba Harvest, as we focus on penetrating new markets in the U.S. and Canada to further drive the company's already strong growth trajectory."

In addition to owning Camelbak, Compass owns approximately 41 percent of the common stock of Fox Factory Holding Corp., a former subsidiary business that Compass spun off in an IPO in August 2013. 

Topics associated with this article: Mergers & Acquisitions

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