It's a scary thing, pulling a significant business segment out of a large, public company, then going public itself. But when your motto is "Changing the way the world eats – for the better," bold moves just come with the territory.
WhiteWave Foods, which has roots back to 1977, was just incorporated in July 2012 as a wholly owned subsidiary of Dean Foods. It became a stand-alone public company three months later. But in just two years (at year-end 2013) it had increased sales 31 percent to $2.5 billion, made a number of acquisitions, including one that stretched it into a completely different category (organic produce), and created a joint venture in China.
And it's on a trajectory to hit $3.4 billion in sales this year.
It's tempting to call Chairman Gregg Engles a former stock broker, but he's now spent more time in the food industry (21 years) than he did on Wall Street. Still, WhiteWave's brief history shows he insists on fast results and likes to build companies with bolt-on acquisitions and other deals.
That all makes WhiteWave the youngest company in our own Processor of the Year history but also the fastest growing.
“Prior to the spinoff from Dean Foods, WhiteWave had effectively been operating as a standalone company for some time,” said Blaine McPeak, president of WhiteWave Foods. “It was a big move, but one we knew our leadership and employees were prepared to make, and a change that we knew would bring further success to our company.”
WhiteWave Foods has an interesting, $3.4 billion collection of product lines and brands that do indeed touch upon changes in the ways consumers eat. It has two strong pillars: plant-based foods (under the Silk and So Delicious brands) and organics (under the Horizon and Earthbound Farm brands).
Add to those coffee creamers (under the strong No. 2 brand International Delight) and you have a collection of products found in the refrigerators of many younger consumers. And while once foreign to their parents, those "alternative" products are being discovered by baby boomers as they age.
Plus, early this year, it formed a joint venture in China to produce plant-based beverages. WhiteWave already had a European business, the Alpro brand, focused on plant-based foods and beverages. So it's operating on three continents and sees just as much potential overseas as it does at home.
Home to the North American operating company is Broomfield, Colo., midway between Denver and Boulder, near where the original incarnation of WhiteWave began. With the Rocky Mountains visible out the office windows, nearly 500 people toil in the company headquarters, and 3,800 more are employed at locations across the country and in Europe.
For the purposes of this Processor of the Year story, we're focusing on the WhiteWave North American business. The corporate and European operations are separate operating segments, and we've excluded Earthbound Farm, too.
WhiteWave's roots go back to Silk and Horizon Organic. Steve Demos and investors in Boulder, Colo., started what initially was a tofu company in 1977. Through trial and error, it focused on soy-based milks. The company name first became Silk, after its soymilk product, then was changed to WhiteWave, Inc. as it expanded. In 2002 WhiteWave was bought by Dean Foods for just under $300 million.
Horizon Organic, the largest supplier of organic milk in North America, was founded in 1991, by Paul Repetto and Mark Retzloff. It was sold to Dean Foods in 2004.
Meanwhile, Engles, the stock broker with a Yale law degree, saw an under-capitalized dairy industry with low utilization rates as ideal for investment and consolidation. He started Suiza Foods in 1993 and grew it through acquisitions into the country's largest dairy company. He merged it in 2001 with former No. 1 dairy company Dean Foods, keeping the Dean name.
Engles became chairman and CEO of Dean Foods, which eventually acquired what would become WhiteWave's key brands. After engineering the IPO of WhiteWave in 2012, Engles went with the new company as chairman and corporate CEO.
'New' in 2012; even newer in 2014
When WhiteWave first separated from Dean Foods, it already consisted of brands that were No. 1 or 2 in their categories: Silk in plant-based beverages, Horizon in organic dairy and International Delight in coffee creamers.
At year-end 2012, although only a few months old, the company had sales of $2.2 billion and net income of $112.5 million.