Global packaged food and beverage giant WhiteWave Foods Co. (NYSE:WWAV) has agreed to spend US$550 million in cash to buy Burnaby-based nutritional supplement company, Vega, the companies announced June 10.
Vega CEO and majority owner Charles Chang, who is a former Business in Vancouver Top Forty under 40 winner, told BIV following the announcement that his rationale to sell the venture was that he needed more capital to make Vega an established global brand.
“The idea of selling started when we realized that the resources required to make Vega a global brand would be either to sell, get more investment from outside or to go public,” he said.
“We really felt that, of all those options, selling to a strategic company that had the same focus and already the reach, the distribution and the experience [was the best option].”
Chang will remain as president for the foreseeable future, and he stressed that all of his 180 employees, including about 90 staff in B.C., will keep their jobs.
WhiteWave is known for alternative dairy products branded Silk or So Delicious as well as organic greens branded Earthbound Farms.
Vega has generated about US$100 million in sales in the past year with about 40% of that being in Canada and the rest in the U.S.
Its biggest selling products are powdered nutritional supplements, which account for approximately 90% of its sales. Nutritional snack bars are another big seller.
“There’s a lot of things that we’ve held off on doing because they are expensive,” Chang said of Vega.
“For example, a ready-to-drink product. We’ve been talking about doing that for years but we’ve been holding back. Now, we can go ahead with things like that.”
The deal is likely to officially close within 45 days.
Chang would not disclose how much of the company he owns, simply saying that he is the single majority shareholder. VMG Partners is another major shareholder.
