| NEW YORK, April 5
NEW YORK, April 5 Santa Cruz Nutritionals and
Nellson Nutraceutical LLC are looking for buyers as the latest
firms in the nutrition sector hoping to cash in on large
companies' hunger for healthy products, three sources familiar
with the situation said.
Santa Cruz, a California-based maker of calcium gummies and
vitamin jelly beans, and Nellson, which makes nutrition bars and
powders, are both being advised by investment bank Houlihan
Lokey, said one of the sources. The sources, who spoke to
Reuters this week, declined to be identified as both processes
Santa Cruz, the more profitable of the two, could fetch as
much as $350 million, said one of the sources, adding that
Nellson, also based in California, may be worth around $150
Houlihan declined to comment. Santa Cruz and Nellson were
not immediately available for comment.
Spurred by an aging population and a growing consumer
interest in health, the vitamin and supplement business is seen
as increasingly attractive. In the United States alone, annual
revenue for the sector was estimated to top $29 billion last
year, according to IBISWorld.
Reckitt Benckiser's $1.4 billion purchase of Schiff
Nutrition last year boosted valuation expectations for the
sector. Reckitt paid about 16.5 times Schiff's estimated
earnings before interest, tax, depreciation and amortization for
fiscal year 2013. That compares to an average earnings multiple
of 12.5 times for the sector, according to an industry banker.
Also last year, Church & Dwight Co Inc, the maker of
Trojan condoms, acquired gummy vitamin maker Avid Health, and
Pfizer bought the maker of Emergen-C vitamin C products.
Canadian vitamin maker Jamieson Laboratories has also held
talks about selling itself, Reuters reported in December.