U.S. dairy products producer WhiteWave Foods Co announced in December it would buy organic food brand Earthbound Farm from investors including private equity firm Kainos Capital for about $600 million to expand its offerings of organic products.
Earthbound Farm produces packaged salads and organic fresh and frozen fruits and vegetables, as well as dried fruits and snacks. Its sales are expected to top $500 million in 2013, WhiteWave said.
“With Horizon Organic and Earthbound Farm, WhiteWave will now provide the two most popular gateways for consumers to enter into the organic category – produce and dairy,” WhiteWave chief executive Gregg Engles said in the statement.
Sales of organic food and beverages are expected to reach about $188 billion by 2019, growing at a compounded annual growth rate of 15.5% from 2013, according to a report by Transparency Market Research.
Earthbound Farm was founded in 1984 in California’s Carmel Valley by Drew and Myra Goodman, self-described transplants from Manhattan, who are also selling their stake.
WhiteWave, spun off from U.S. dairy company Dean Foods Co last year, said in October 2012 it planned to grow by making acquisitions outside of its core products, which include Silk soy milk and International Delight creamers.
While the company said it would operate Earthbound Farm as a separate business, it has been criticized for taking over the Silk soymilk product line and converting it from 100% organic to virtually no certified organic products and replacing organic with “natural” products.