The Hain Celestial Group, Inc. is exploring selling some of its "more lower-margin businesses,” founder and CEO Irwin Simon told the New York Post.
The Lake Success, N.Y.-based organic food manufacturer and marketer (NASDAQ: HAIN), which owns the Earth’s Best organic baby food, Celestial Seasonings tea, Rudi’s Organic Bakery, and BluePrint cold-pressed juice brands, among others, has been unable to find a buyer despite being informally on the block for about a year, according to The Post report.
“I’ve said this year we are looking at a strategic overview of all of our business, and some things may not fit,” Simon told The Post, adding that the company’s chicken and turkey division, Hain Pure Protein (HPP), is a divestiture candidate.
Hain reported in November that net sales for HPP increased 2 percent to $119.1 million, reflecting a 6 percent increase from the combined FreeBird and Plainville Farms businesses while the Empire Kosher business net sales declined 6 percent with more sales attributable in the prior year period due to the timing of the Jewish holidays.
HPP’s operating income increased to $2.2 million from the prior year period loss of $1 million and adjusted operating income increased to $3.6 million from the prior year period loss of $1 million due to improvements in operating expenses across the business.
The world’s largest food company, Nestlé S.A., is reportedly interested in making a bid for Hain, according to a Bloomberg report in November.
The Post said Nestle is interested in buying the business if it first sells its chicken and turkey division, citing a source.
Shares of Hain Celestial closed Friday at $40.51. The company’s stock has a 52-week trading range of $31.01-$45.61, with a market cap of $4.2 billion.
Simon told The Post that Hain’s largest customer is Amazon.com, which owns the Whole Foods Market organic and natural grocery chain, and represents up to 11 percent of Hain’s sales.
Simon said Hain "went through a major SKU rationalization this year” with Whole Foods cutting the number of products it sells to Whole Foods to 700 – about half.