Oregon Chai-Private Equity Capital-Beverage Manufacturer

Investment case studies

Beverage Company, Foodservice and Specialty Distribution equity investments

Oregon Chai, Inc. is the leading national brand of chai (specialty spiced tea) beverages. The Company distributes its liquid concentrate, dry powder mix, and ready-to-drink bottled products primarily through natural food distributors, retail grocery stores and foodservice distributors.

SPC Investment Date
June 2002

SPC Investment Thesis

Oregon Chai’s #1 position in chai tea would allow them to realize above-average revenue growth, particularly in the natural food channel
Expansion and proper management of a direct sales force could grow revenues in excess of historical averages
Cost savings were likely through better management of co-pack relationships
A wide-range of domestic and international strategic buyers would be interested in a unique beverage company with a dominant niche

Key Sources of Value Creation

Growth Strategies: Implemented channel-specific sales force strategy and entered ready-to-drink market to demonstrate extendibility of brand into large mainstream markets
Management: Added new sales people and operations management
Exit: Managed sale process to international strategic buyer

Exit
SPC sold Oregon Chai to Kerry Group, a leading international food ingredients company, in March 2004

Case Studies Overview
Eagle Pack Pet Foods
Fleischmann's Vinegar
Liberty Brand Products
Oregon Chai
Reef Holdings
S.T. Specialty Foods, Inc.
Totes Isotoner