Dive Brief:
- Hain Celestial is selling its North American snacks business, which includes Garden Veggie Snacks, Terra chips and Garden of Eatin', to Canadian snacks manufacturer Snackruptors for $115 million.
- The deal, set to close by the end of the month, will leave Hain with a simplified North American portfolio focused on core categories and markets with stronger margin and cash flow to help drive growth. Hain will retain Celestial Seasonings teas, Greek Gods yogurt, Spectrum Organic culinary oils and Earth's Best Organic baby and kids foods.
- CEO Alison Lewis, who took over the role permanently in December, has vowed to stem Hain’s sales decline by leaving unprofitable or low-margin SKUs and exiting businesses where it is “structurally disadvantaged” or does “not have a right to win.”
Dive Insight:
Hain was built through dozens of acquisitions as the natural and organic food and beverage maker adopted a growth-at-all-costs mindset — leaving it with a disparate group of brands in nearly 40 different categories and a portfolio with little coherence.
Now, the company is making a major move to reverse that strategy in hopes that a sale of one of its key businesses will leave it in a stronger financial position and better able to compete against big food companies and changing consumer buying habits.
“The sale of our snacks business is a decisive first step we are taking to sharpen our focus on categories and platforms in key markets where we can leverage our strongest organizational capabilities,” Lewis said in a statement. “The transaction we are announcing today marks a significant moment for Hain Celestial.”
Despite playing in trendy categories such as gluten-free, high protein, GLP-1 friendly and free-from artificial colors, Hain is facing mounting competition from General Mills, Nestlé and other companies who have also launched new offerings tapping into consumer interest for healthier eating. Hain also has been hit by inflation, economic uncertainty and other headwinds that have weighed on sales and further depressed margins.
Hain ultimately decided that the snacks segment, once a major cornerstone of its business, was facing insurmountable outside pressure, making a sale the most attractive option. Recent efforts to increase marketing, target new channels like convenience stores and launch innovations — such as a healthier tortilla chip under its Garden Veggie brand — proved to be too little, too late.
With a sale, Hain is in a better position to lower debt, boost margins, sharpen its focus and help “drive sustainable, profitable growth and create long-term shareholder value,” according to Lewis.
In a research note, analysts at William Blair said it viewed the sale “as a constructive first step in the execution phase of the company’s ongoing strategic review,” adding that “there is a case for value to be created” in the remaining business.
Hain estimated that its North American snacks portfolio was responsible for 22% of the company's $1.6 billion in net sales in fiscal 2025.
The deal announced Monday may be just the beginning of sell-offs for Hain. The company has also previously explored options for its personal care segment, which includes lotions and shampoos and makes up a small portion of its existing business.
Hain also will be left with Celestial Seasonings, its tea brand which remains popular with consumers who are flocking toward better-for-you beverages. The Sleepytime tea maker could attract the interest of a private equity firm or company like Coca-Cola looking to double down on healthier products.
Another bright spot for Hain is its meal prep business, which includes honey, soups, jams, cooking oils and nut butters. Cooking at home has been surging as cash-strapped consumers look to save money by doing more in their home kitchens.
Hain also owns Greek Gods, a small brand in the fast-growing yogurt space popular with protein-hungry consumers. But despite its favorable position, the dairy offering is going up against juggernauts, such as Chobani and Danone, who have bigger marketing budgets, innovation efforts and retailer connections.
