BGL Makes Bakery Leader Best Brands’ Expansion a Piece of Cake

Brown Gibbons Lang & Company (BGL) announced today the successful recapitalization of Best Brands Corp. (Best Brands) and its subsequent acquisition of Multifoods Foodservice & Bakery Products (Multifoods), a division of the J.M. Smucker Company (NYSE:SJM).

Best Brands, with operations in Eagan, MN, and Dallas, TX, is a leading national manufacturer and distributor of high-quality specialty bakery products to in-store bakeries, retail bakeries, and food service establishments. The company is owned by a consortium of shareholders that includes Value Creation Partners Inc. (which includes management of Best Brands), Brantley Partners, National City Equity Partners, and Prudential Capital Group, which acquired Best Brands in 2000.

The group has since made substantial capital investments in the company and expanded capacity, personnel, and infrastructure to manage Best Brands’ strategic shift into higher value-added manufactured products. Once the company was successfully repositioned, the shareholders engaged BGL to explore strategic liquidity alternatives. In conjunction with the shareholders and Best Brands’ management, BGL explored a variety of alternatives to maximize the company’s value including a recapitalization or sale of the business. According to G. Scott Humphrey, president of Best Brands and a principal shareholder of Value Creation Partners Inc., “BGL’s knowledge of the bakery sector was evident based on the quality and quantity of global strategic buyers and food-focused financial buyers in the process. Our bankers delivered attractive opportunities to partner with a firm to help accelerate our growth.”

Because of the strong underlying growth in the business, Best Brands’ owners decided to pursue a recapitalization transaction, whereby the shareholders received a substantial return of capital and still retained majority control of Best Brands. The recapitalization was completed in late 2004, with the entire financing package provided by GE Capital. “BGL’s capital markets experience proved valuable in structuring and negotiating the company’s eventual recapitalization. The recapitalization provides the investors an opportunity to recognize future value as the company continues to grow,” said Paul H. Cascio, general partner at Brantley Partners.

Following the recapitalization, BGL identified Multifoods as a potential strategic acquisition target for Best Brands that would unite complementary businesses and offer significant synergistic growth possibilities. The Multifoods business consists of the manufacturing, marketing and distribution of baking mixes and frozen baked goods to restaurants, retail and wholesale bakers, and other commercial customers in the U.S. and Canada. For the 2004 fiscal year ended February 28, 2004, Multifoods had net sales of $202.5 million.

BGL advised Best Brands on the structure of the Multifoods transaction, including valuation, consideration, and key terms and conditions. BGL also worked with the company to identify and source various financing alternatives to consummate the transaction. The purchase price for the transaction is approximately $43 million. The acquisition of the Multifoods business adds muffin and other specialty product lines to Best Brands’ core focus in cake and laminated dough products. Additionally, with its strength in the foodservice channel, Multifoods business complements Best Brands’ focus of in-store bakeries.

“This transaction is the culmination of years of smart strategic planning and successful rebuilding by the entire Best Brands team to position the company as a leader in the specialty baked goods sector. The company has solid financial support from its owners and the management de