Favorite Brands International
 | |
| Industry | Confections |
|---|---|
| Founded | July 1, 1995 |
| Defunct | November 19, 1999 |
| Successor | Nabisco |
| Headquarters | , United States |
Number of locations | 11 plants |
Area served | North America |
Key people |
|
| Products | |
| Brands | Jet-Puffed Marshmallows |
| Revenue |
|
| Owner | Texas Pacific Group |
Number of employees | 4,000 |
Favorite Brands International was founded in 1995, when Texas Pacific Group bought Kraft Foods, Inc. confection division.
Formation
[edit]In early 1995, the newly appointed head of Kraft General Foods, James M. Kilts, merged Kraft USA, General Foods USA, and Kraft General Foods Canada into a single organization called Kraft Foods, Inc. This was the main food subsidiary of Philip Morris USA. Looking to improve margins, Kraft Foods put their confections division, which consisted of the Jet-Puffed Marshmallows brand and Kraft Caramels, along with the Kendallville, Indiana plant, and marshmallow production and packaging equipment from Kraft's Buena Park, California, Garland, Texas, and Canadian plants, up for sale in early 1995. Texas Pacific Group and InterWest Partners acquired the $150-million-in-sales caramel and marshmallow businesses on July 1, 1995.[1]
Expansion
[edit]Al Bono was the president-chief executive officer.
In May 1996, Favorite Brands quickly bought out one of its major competitors, Kidd & Co, headquartered in Ligonier, Indiana, only a few miles away from its flagship plant in Kendallville, along with a plant in Henderson, Nevada. In October 1996, the Ligonier plant was converted to a warehouse and all production was transferred to the Henderson and Kendallville plants, along with the employees.[2]
Favorite Brands bought Sathers, Inc., Round Lake, Minnesota, with an estimated $200 million in annual sales.[3]
Favorite Brands bought Farley Foods USA, August 31, 1996, with an estimated $300 million in annual sales, and five production facilities.[3]
Mark Upson, who was hired in March 1998, as the president-chief operating officer, resigned in late May of the same year. Al Bono, the chairman-chief executive officer, resigned in late July 1998, citing "differences in operational issues with the board".[4]
Bankruptcy and buyout
[edit]On September 29, 1999, Nabisco announced they were buying Favorite Brands for $475 million along with assuming $600 million of debt owed to creditors.[5]
References
[edit]- ^ TPG.
- ^ Kidd & Co.
- ^ a b Denton 1996.
- ^ Lazarus 1998.
- ^ Noah, Higa. "Fundamentals Of Corp Finance".
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Bibliography
[edit]- "Kidd and Company, Inc". Retrieved 18 October 2018.
- "History of Texas Pacific Group Inc". Retrieved 11 November 2019.
- Lazarus, George (July 28, 1998). "More Sour News". Chicago Tribune. Retrieved 17 October 2018.
- Denton, Jon (September 13, 1996). "New Owner Expands Candy Plant in City". The Oklahoman. Retrieved 17 October 2018.
- "Company Overview of Favorite Brands International, Inc". Bloomberg News. Retrieved 12 October 2018.