- Brynwood Partners VII L.P. has agreed to acquire Sunny Delight Beverages Co. from private equity firm J.W. Child Associates. Brynwood is going to buy it for $195 million after receiving regulatory approval, a person familiar with the deal told The Wall Street Journal.
- Brynwood Partners also oversees brands like Juicy Juice, Little Hug juices, and Daily's Cocktail through its ownership of Harvest Hill Beverage Company.
- Sunny Delight's recognizable bottle design and loyal customer following are appealing to Brynwood Partners, according to Henk Hartong III, chairman and CEO of Brynwood Partners, in a statement.
Consumers have turned away from sugary drinks like fruit juices and soda in favor of beverages they deem to be healthier. Sunny Delight contains only 5% juice, as compared to the 100% juices consumers prefer, in addition to being sweetened with corn syrup and artificial sweeteners, which are also falling out of favor with health-conscious consumers.
This shift presents a challenge to Brynwood, owner of several juice brands. The acquisition of Sunny Delight, with around $425 million in yearly sales, would about double the firm's beverage business. Brynwood plans to utilize relationships formed via the rest of its beverage brands to push Sunny Delight to more retailers.
One option for juice companies is to add value to their products, such as additional healthy ingredients or fortification with vitamins and minerals.
"To offset some of the value declines you’ve seen in juice, you have consumers moving toward these premium, value-added juices, where it’s not simply orange juice, but it’ll be carrot mixed with peach and lemongrass, where the consumer feels like they’re getting more out of what they’re consuming," Eric Penicka, U.S. research analyst specializing in the beverage industry at Euromonitor, told Food Dive last month.