M. Dias Branco buys Jasmine Alimentos, with an eye on healthy products
After setting foot in the healthy food market with the purchase of Fit Food last year, M. Dias Branco decided to enter full-length. The company from Ceará has just purchased Jasmine, a brand that leads categories such as granola, gluten-free bread and whole-grain cookies in the country, according to Nielsen data.
Founded in the 1990s as a family business in Paraná, Jasmine became controlled in 2014 by the multinational Nutrition et Santé (a food company belonging to the Japanese group Otsuka). The brand should close the year with revenue above R$ 200 million. The value of the transaction was not revealed by the companies, but Pipeline found that it was around R$350 million.
“We are acquiring a company that already has leadership in three categories, connected with the consumer of the future. It is a company that practices ‘healthiness’ since its foundation and is a reference in the segment”, said Gustavo Theodozio, VP of investments at M. Dias Branco, to Pipeline. “This acquisition is very connected with our strategic plan.”
Almost all of Jasmine’s portfolio is vegan, with the exception of 5% of the line, which has honey in its composition. This allows the brand to be marketed with important labels in the segment, such as Orgânico Brasil and Vegan. It is one of the few manufacturers in the country that can effectively use the word “organic” on the packaging, as more than 90% of the composition of its products comes from this origin.
When they founded Jasmine, the couple Rosa and Cristophe Allain were motivated by the difficulty of finding wholegrain products in supermarkets for family consumption. They began to purchase staples such as brown rice and brown sugar on a larger scale and it soon became a small business. From fractional packages to friends, neighbors and small grocery stores, Jasmine was the first national brand to put granola and wholemeal cookies on supermarket shelves.
The M&A strengthens M. Dias Branco’s presence in its main growth targets, which are the South and Southeast regions. It is from this area that 50% of Jasmine’s sales come, where the buyer has only 20% of market share. In the North and Northeast, the group has an average of 60% of the market in the main categories, reaching 90% in some states.
Another advantage of the acquisition, emphasizes the VP, is the better average gross margin. At Jasmine it is 45%, against 34% for the buyer.
Jasmine’s distribution, which is currently outsourced and reaches 26 thousand points of sale, should more than double – the flours, cookies and pasta from M Dias Branco, owner of brands such as Adria, Puro Sabor, Piraquê, Isabela and Fortaleza, arrive to 101 thousand points, through internal logistics.
For that, of course, the production volume will also have to increase. Theodozio says that this was already on the brand’s radar. With a series of investments made over the years by the French parent company in manufacturing facilities, Jasmine currently operates with 70% idle capacity.
AM Dias Branco incorporates more than 140 items to the portfolio, many of them unpublished in its factories – and precisely those in which Jasmine leads. It is an acquisition more than twice the size of Latinex, the owner of Fit Food and Smart absorbed last year. Latinex’s annual revenue is R$ 60 million.
Latinex and Jasmine start to complement each other in a new business unit, healthy foods. To manage the vertical, M Dias Branco will retain Jasmine’s C-level executives after the conclusion of the M&A (in the purchase of Latinex, it took the partners to the team).
The healthy food segment has an average annual growth rate estimated at 5.3% until 2025, worldwide, according to data from consultants Statista and Mintel. Above the food industry in general, therefore, projected at 3.6%, and the indulgence/superfluous market, at 4.5%. In emerging markets, consultancies project even greater rate differences in ‘healthy food’.
The transaction between M. Dias Branco and Nutrition et Santé was advised by Estáter e Pinheiro Neto, on the buyer’s side, and by Seneca Evercore, on the seller’s side. The deal now depends on regulatory approval.
Source: Value Pipeline