November 17, 2016

Private equity firm, Graham Partners, announced it has agreed to acquire freeze-dried food company, Mercer Foods from private equity firms, Fontenac Co. and Lake Pacific Partners for an undisclosed amount. Middle market investment bank Harris Williams & Co. served as the advisor to Mercer Foods during the transaction.

“There continues to be strong interest in the M&A market for food ingredient and better-for-you snack food businesses,” noted Brant Cash, a director at Harris Williams & Co in a company statement. “Mercer Foods’ products deliver the clean ingredient panels and offer the healthy snacking alternatives consumers want. In addition, the company’s compelling growth trends attracted significant investor interest.”

Founded as a family business in 1980 in Modesto, California, Mercer manufactures natural and organic freeze dried fruits, vegetables, and other food ingredients from its 140,000 square foot facility.

Frontenac and Lake Pacific Partners led a recapitalization of the company starting in 2011 that included investing in its leadership team, the build-out of its production capacity, and the expansion of its production line. These efforts launched a growth trajectory that saw the company double in size.

“Mercer is a terrific business that has not only grown bigger, but also stronger and more diversified under our ownership,” said Walter Florence, managing partner at Frontenac. “We are pleased to have worked with the team to achieve the scale, success and customer satisfaction we have delivered together.”

Graham Partners focuses on investing in businesses that have EBITDA of between $5 million and $50 million that bring with them advanced industrial technologies, innovative products, and a strong potential for growth. What attracted Graham to Mercer was the company’s internally designed proprietary freeze-drying equipment and packaging solutions, its track record of innovation, and the conversion opportunities inherent in the freeze dried food sector.

“Mercer is a strategic fit for the Graham portfolio due to industry overlap with several of Graham’s portfolio companies, providing parallel access to industry expertise and familiarity with macro trends and existing and potential customers,” said Andrew Snyder, managing principal at Graham Partners.

“Graham’s family heritage resonated with the Mercer team because it very much aligns with our company’s history;” said David Noland, CEO of Mercer. ”We are looking forward to collaborating with Graham and the industry experts they have already brought to the table to pursue growth opportunities in adjacent markets.”

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Lynda Kiernan