Homegrown Natural Grabs Fantastic Foods and Napa Valley Kitchens

NAPA, Calif.--Homegrown Natural Foods Inc., a majority shareholder in Annie's Homegrown Inc., has agreed to acquire both Fantastic Foods Inc. (maker of soup/meal cups) and Napa Valley Kitchens Inc. (maker of olive oils/dressings) for undisclosed sums. The purchase will boost Homegrown to about $11 billion in value, based on May 2000 data reported by Packaged Facts. Under terms of the agreements, Homegrown will buy the two companies and operate them as wholly owned subsidiaries. As a result, the company's annual sales are projected to be around $50 million.

"Our goal at Homegrown is to build these acquired brands and make them available to more consumers, while remaining true to the product quality and brand heritage created by each company's founders," said John Foraker, co-founder and chief executive officer of Homegrown. "By leveraging our financial resources, we intend to bring high quality, innovative products to market faster, as well as improve our ability to partner with retail and distributor customers and the broker sales community."

Analysts have predicted Homegrown will become a significant player in the industry following these acquisitions. "Homegrown's strategic acquisitions are notable in this traditionally, highly fragmented natural foods industry" said Carol Buyers, natural food analyst with Tucker Anthony Capital Markets. "All these brands deliver on current consumer purchase priorities." Homegrown invested in Annie's Homegrown, a maker of natural pasta products, in December 1999, a year after Annie's acquired the Tamarind Tree line of frozen vegetarian entrees.

Jim Rosen, founder of Fantastic Foods, noted that, "Homegrown will provide the energy to grow the brand through innovative new products and creative marketing approaches." He further stated his belief that Homegrown will maintain the vegetarian legacy of the Fantastic Foods brand. Fantastic Foods was part of the Small Planet Food group, but was split off when that business was sold to General Mills late last year.

To learn more, visit www.homegrownnaturalfoods.com.