Equity firm to take stake in Acosta

1/5/2011

Acosta Sales & Marketing, a top grocery industry broker in Canada and the U.S., is adding a new partner.

Thomas H. Lee Partners (THL), a Boston-based private equity investment firm, has signed an agreement to purchase an ownership stake in Acosta from AEA Investors. AEA had owned part of Acosta since 2006 after buying out a minority stake held by Berkshire Partners.

Terms of the deal were not disclosed and a spokesperson for Acosta declined to say what percentage of the company THL will own. However, Bloomberg pegged the deal as worth US$2 billion.

Acosta said the transaction will help "fuel the continued expansion of Acosta's service offerings into new strategic areas, as well as enhance the existing suite of services." Acosta said it already represents two-thirds of the No. 1 and No. 2 brands in the consumer packaged goods industry in North America.

"As a market leader that delivers sales and marketing services to the CPG industry," Acosta presents an ideal investment opportunity," Ken Weldon, managing director of THL, said in a statement.

Founded in 1974, THL has invested in companies such Aramark food services, Dunkin Donuts, Clear Channel and The Nielsen Company.

Acosta stated there will be no changes to Acosta's operations once the deal closes and that senior management will stay in place. In the U.S., Acosta is headquartered in Jacksonville, Fla. and in Canada in Vaughan, Ont.

This is the second major deal between a grocery industry broker and private equity firm in recent months. In November, Advantage Sales & Marketing announced that Apex Partners had purchased a majority stake in the company. The deal was estimated to be worth $1.8 billion.

Also, this week a private equity firm purchased the Zest brand for Canada, the U.S. and the Caribbean from Procter & Gamble. That firm, Brynwood Partners VI, of Greenwood, Conn., intends to incorporate Zest into its newly created portfolio company, High Ridge Brands Co.

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