GTCR Cuts Into Swissrose

GTCR Golder Rauner has proven itself to be a lover of cheese. The firm bolstered its Fairmount Food Group specialty food platform, buying ConAgra Foods’s cheese unit, Swissrose International. Terms of the deal were not disclosed.

Published reports, however, have said that the sale likely drew between $75 million and $125 million based on previous projections made by ConAgra officials.

Moonachie, N.J.-based Swissrose makes more than 64 varieties of cheese under 11 separate brand names, including Country Line, a maker of deli-style cheeses; Ilchester, which makes and imports specialty English cheeses; and Queso Authentico de Espana, a provider of Spanish cheeses. The 68-year-old company supplies its product to retail and foodservice customers across the U.S.

“With this acquisition we are more than doubling the size of our specialty cheese portfolio and expanding our U.S. presence from coast to coast,” said Bing Graffunder, CEO of Fairmount Food Group.

Indeed, the acquisition of Swissrose makes Fairmount the largest U.S.-based importer and marketer of specialty and deli cheeses, with the combined business generating north of $500 million in annual revenues.

Fairmount, based in Dallas, Texas, was created by GTCR in 2003 with a $200 million equity commitment. The business is partly defined as “succession vehicle” for business owners who want both liquidity and the assurance that their company’s “legacy continues in the manner in which it was built.”

While the platform was created to house specialty foods, most of Fairmount’s holdings, to date, are focused on cheese-related entities such as DCI Cheese Co. and Green Bay Cheese Co. The only company currently in Fairmount’s portfolio not exclusively focused on cheese is G&G Foods, which, in addition to cheese products, markets a number of non-dairy dips and spreads.

Broadly, Fairmount’s focus is on transactions in growth segments of the food industry. More specifically, the company targets opportunities in branded food, branded beverage, retail and foodservice.

“We see exceptional growth potential in the specialty foods niche as consumer tastes trend toward premium-quality, healthy and organic items,” said GTCR Principal Vince Hemmer.

Swissrose caught GTCR’s eye because of its broad portfolio of import licenses and its “great track record” of selling its products to retailers, Hemmer said.

Fairmount is an investment in GTCR Fund VIII LP, which closed on capital commitments of $1.85 billion in November 2003.

GTCR has had a history of success in the branded consumer space, although Fairmount is currently the only company in its portfolio that targets the food space. GTCR also owns crafts company EK Success, which recently inked a deal to market products with Martha Stewart, and the Chicago firm had past success with its investment in Prestige Brands, a distributor of personal care and household cleaning brands. —A.N.