Strong Roots, the Irish-founded plant-based frozen food company, has secured a $55 million (€48.7 million) investment from McCain Foods .
The Canadian food giant is taking a minority stake in Strong Roots, which was founded by Sam Dennigan in 2015, in a deal that sees previous investor Goode Partners exiting.
Speaking to The Irish Times, Mr Dennigan said the new investment would help the company achieve its goal of becoming a major global brand.
“We’re absolutely delighted with the deal. We’ve wanted to become a household name and this helps us get there faster. It also gives us more legitimacy in the market because just six years we were this little Irish brand that no one knew about and now here we are partnering with one of the biggest food companies in the world. To be honest I’m still pinching myself that it has happened,” he said.
Strong Roots specialises in healthy frozen vegetable products such as kale-and-quinoa burgers, roasted beetroot wedges, spinach bites and sweet potato fries. Its products are sold in over 8,000 stores worldwide including major retailers in Ireland, Britain, and the US, as well as Singapore, Iceland, United Arab Emirates, Bahrain, and Qatar.
Mr Dennigan said that under the deal, Strong Roots would retain control.
“The main changes from this is that we will be able to take advantage of McCain’s incredible strengths in manufacturing and distribution to significantly extend our reach” he said.
Strong Roots had been involved in a shareholder dispute with Goode, which held a 38 per cent stake in the business prior to its exit. The New York-based private equity firm, which led an $18 million investment in the business in 2018, had initiated legal action over the last year. It claimed that Strong Roots had failed to reach targets set out in agreements with the company profits coming in €2.7 million lower than a previously agreed threshold of €7.3 million.
Mr Dennigan said agreement had been reached leading to a successful exit for Goode. He insisted that prior to Goode’s exit, Strong Roots was already on the hunt for a growth partner for the next phase of the business.
"I want us to be the second billion dollar food brand to come out of Ireland after Kerry Group. I believe we are in the process of building a hugely successful sustainable food company that is trading globally from Dublin," he said.
The growth of plant-based foods is soaring with the market expected to exceed $162 billion by 2030, a 451 per cent rise from 2020. In the US alone the plant-based food market is expected to reach $74.2 billion in the next five years.
McCain is the world’s largest manufacturer of frozen potato products to retail and food-service companies. Founded in 1957, it employs 22,000 people and generates $19.50 billion in sales.
Max Koeune, president and chief executive said: "Since the McCain family founded McCain Foods in 1957, our entrepreneurial roots and passionate focus on creating the best tasting food has led to us being at the centre of mealtimes for generations.
“That’s why we’re so excited to be partnering with Strong Roots, a company that not only aligns with our innovative approach to creating food, but also helps us grow our portfolio of healthier food that meets changing consumer demands in a sustainable way. We’re looking forward to working with Samuel and the Strong Roots team to help bring a healthy range into more homes across the world.”
