Founded in 1979 as an importer of tropical fruits to the United States, Fine Dried Foods (“FDF” or the “Company”) grew into a multi-national processor of specialty dried fruit. Serving a number of blue-chip customers, including Trader Joe’s, the Company sourced product from South America and India to four strategically located processing facilities throughout Mexico. This ability to source product year-round and provide large quantities of consistently high-quality product led to long-term relationships with its customer base and steady revenue growth.
During an inventory audit, it was discovered that former employees of Fine Dried Foods had mismanaged second-grade product, resulting in large quantities of hard-to-move inventory accumulating on the balance sheet. With a leveraged balance sheet and limited access to vital working capital to purchase raw materials and fund labor during the critical harvest periods, the Company’s margins dropped significantly. Management successfully resolved the inventory issue, but FDFs’ lender was no longer willing to maintain the relationship. This prompted ownership to seek a strategic or financial partner with additional resources to meet an ever-increasing demand and target higher-margin products and sales channels.
SC&H conducted a global marketing process that identified 59 interested parties and, through significant negotiations, identified an acceptable offer. The buyer took over operations and provided continued employment for the management team, including the owner.
