Field Trip Jerky engaging with strategics for possible investment or sale, co-founder says

Provided exclusively by Mergermarket, an Acuris Company

Field Trip Jerky, a manufacturer and marketer of all-natural branded jerky, is engaging with suitors who are interested in investing in or acquiring the company, co-founder and Founding Partner Matt Levey told this news service.

Brooklyn, New York-based Field Trip has spoken with a number of outside advisors about potentially running the talks, but has not yet mandated one and continues to welcome approaches, he added.

Levey said the company has received informal buyout approaches in the past, but noted that the quantity and intensity of conversations around the company have been heating up during the past 90 days.

To date, Field Trip has raised between USD 5m and USD 7m from outside investors and is currently open to a minority investment by a strategic partner or a sale to a partner that was the right fit at the right price, he said.

Levey declined to define what valuation expectations the company would have in the case of a sale or investment, but noted that the jerky sector has been “hot.”

In June 2016, Levey told this news service that he believed industry multiples were at the lower end of a range of 5x to 8x revenue. At the time, Field Trip had an annual run rate of USD 15m to USD 25m.

Field Trip notched 40% revenue growth in 2016 and expects sales growth of about 60% among its core retail accounts in 2017, he said.

In 2015, The Hershey Company [NYSE:HSY] purchased California-based premium jerky maker Krave Pure Foods, and General Mills [NYSE:GIS] acquired Texas-based meat snacks maker EPIC Provisions a year later.

Terms were not disclosed for either deal, however published reports estimated that Hershey’s purchase of Krave fell between USD 200m and USD 300m. The company had USD 35m in net sales at the time of the acquisition, according to a company release.

Field Trip would not necessarily aim to maximize its valuation if it felt like it found a suitor that matched the founders’ growth strategy, Levey said.

In order to help a potential suitor “hedge” the valuation, the company would be open to alternative structures such as an earn-in, an investment in the business alongside the buyout, and/or an equity stake that would remain with the founders for them to capitalize on Field Trip’s continued growth, he added.

Although strategic suitors would be most logical, Levey said the company would be open to approaches from private equity suitors bringing relevant synergies through their other portfolio companies.

For the 2016 Mergermarket report, Levey mentioned Charlotte, North Carolina-based Snyder’s-Lance [NASDAQ:LNCE], PepsiCo-owned [NYSE:PEP] Frito-Lay and Minneapolis-based General Mills [NYSE:GIS] as the types of strategics that could show interest in Field Trip, though the executive said he hadn’t “necessarily spoken with” any of those companies.

Field Trip has placed 95% of its growth focus on the US market for the moment, but the company would be open to approaches from international suitors as well, according to the co-founder.

The company has been eyeing the Canadian and Chinese markets, and would prefer to line up a strategic partner in Canadian retail before launching there, he added.

The company sells its jerky and meat stick products through about 35,000 total distribution points, which include outdoor retailers such as REI, LL Bean and Camping World and big box retailers such as Costco, BJ’s, Sam’s Club, and Target. The company also sells to a variety of grocers including Kroger and Sprouts Farmers Market and pharmacy and convenience store chains including CVS, Rite Aid and Wawa.

Airports also form a growing portion of Field Trip’s sales, with its products sold in CIBO Marketplaces and also a part of in-flight meal kits for JetBlue and Delta, Levey mentioned.

Field Trip’s existing investor base includes the Benvolio Group, New York-area distributor Big Geyser and Burch Creative Capital.

The Giannuzzi Group serves as Field Trip’s law firm.

by Nicholas Clayton in New York

As seen in the mergermarket, an Acuris company, newsletter on 25/08/2017

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