January 5, 2017

Vendis Capital announced it has sold its stake in Yarrah Organic Pet Food to AAC Capital, which has acquired the stake in partnership with the Yarrah management team led by CEO Basvan Tongeren.

AAC Capital is a leading European Benelux (referring to the Benelux Union – the three neighboring states in Western Europe of Belgium, the Netherlands, and Luxembourg) mid-market buyout firm, with €1.7 billion under management and two specialized investment funds dedicated to buyouts in North-Western Europe according to the firm’s website. This deal marks the fourth acquisition for the firm’s Benelux-focused fund.

Yarrah is the leading bio-organic pet food brand in Europe with a full range of certified organic products for dogs and cats that contain no chemical additives, preservatives, or hormones, while maintaining a high benchmark for the animal welfare of the livestock used to produce its foods.

“Yarrah is operating in a growing ‘on-trend’ niche market as the European specialist in organic pet food,” said Marc Staal, chairman at AAC. “Bas van Tongeren and his team have a clear vision and philosophy: providing a healthy and sustainable pet food alternative to what is currently offered in the market. Yarrah takes a leading role in pure organic pet food; food that’s not only better for pets, but for all animals.”

The company plans on using the capital from the transaction to fund the acceleration of its expansion.

“Yarrah’s view on its future business development, both in terms of geographies, distribution channels and new product development are well defined and being executed with high momentum,” said Staal.

“In AAC we have found the perfect partner to support us in the next leg of our journey,” adds Bas van Tongeren CEO of Yarrah.  “The partnership with AAC will allow us to expand into upcoming organic markets and accelerate our expansion in the pet retail channel.”

 Tapping into a Niche

Increased humanization of pets by highly engaged consumers is leading purchasing trends in the pet food industry to parallel those in the human food sector. The health consciousness and concern over sustainability that are driving consumers’ choices for themselves and their families, are also increasingly driving their food choices for their pets.

Specialty pet foods and treats are outperforming traditional offerings according to Pet Food Industry.com, with the bulk of the products in these two categories falling under the classification of “premium”, “super-premium”,  “organic”, or “natural”.

Similar to the human food sector, these shifts are translating into consumer demand for cleaner ingredient labels on pet foods, and are leading consumers to search out grain-free and plant-based formulas; however, they are also favoring real meat and animal-based protein sources.

The willingness to pay more for organic or natural products is resulting in a booming market. Retail sales of specialty pet foods in the U.S. reached $11.8 billion in 2013 according to Packaged Facts as reported in Pet Food Industry, and are expected to see a compounded annual growth rate (CAGR) of 14.6 percent between 2014 and 2019.

This higher demand has enabled Yarrah to expand its geographic footprint since its launch in 1992 beyond the Netherlands to include core markets in Germany and France.

“Yarrah is a leading brand operating in a fast-developing niche,” adds Michiel Deturck, partner at Vendis Capital. “We are very happy that Yarrah found a strong partner with AAC that can support the next growth phase of the company. We want to thank the management team for a very pleasant and successful partnership and wish the team all the best with its new partner.”

–Lynda Kiernan

Lynda Kiernan is Editor with GAI Media and daily contributor to GAI News. If you would like to submit a contribution for consideration please contact Ms. Kiernan at lkiernan@globalaginvesting.com