Today, San Diego-based Chosen Foods, the maker of paleo-friendly sauces and oils, revealed it had been acquired by Mexico-based Sesajal S.A de C.V. The deal officially closed in January 2017, but the two companies have held off on publicly disclosing the news until becoming fully integrated.
Chosen’s 50 employees have become part of Sesajal’s 1500 person workforce with much of its management team remaining in place. However, Chosen’s founder, Carsten Hagen, has departed the company for personal reasons.
Founded in 2009, Chosen has had a longstanding relationship with Sesajal. In 2015 Chosen sold 50 percent its shares to Sesajal; following the investment Sesajal’s executive Gabriel Perez became Chosen’s chairman of the board. Following the acquisition, Perez was appointed CEO of Chosen.
Although Sesajal was the single largest shareholder in Chosen, Perez said the ultimate decision to sell to Sesajal lay in the hands of its founding partners. “The [founders felt that the] acquisition by Sesajal gives Chosen the highest probability of maintaining the DNA, the culture and the strength of its supply chain,” he said.
The acquisition will also allow Chosen to take full advantage of all of Sesajal’s sourcing and manufacturing capabilities as one of the leading suppliers of oils and seeds in the world. In turn, Sesajal, which focuses on selling only to food manufacturers, will gain an avenue to directly reach the U.S. consumer.
“[Sesajal] loved the company. They loved what Chosen foods stands for and the team of people that have built it since day one. And the experience and maturity and strength of Sesajal, it just made sense,” Perez said. “Sesajal invested in consolidating all the supply chain and vertical integration of production, now they are focusing on the distribution of the product.”
In 2016 Chosen ranked 5th in the food and beverage division of Inc.’s list of 5000 fastest-growing companies. While current sales have not been disclosed, In 2015 Chosen listed revenues of $31.7 million. Since then, Perez said, the company has “grown exponentially” and more than doubled its product line and penetration in the U.S. market. Its line of oils, mayonnaises and quinoa is currently sold in more than 30,000 retailers in across North America.
Earlier this year the company released mayonnaises with trendy ingredients such as black garlic and wasabi, and at the Summer Fancy Food Show, Chosen highlighted new infused oils and avocado oil-based salad dressings. Perez believes this focus will continue to be a core tenet of the business.
“The innovation team we have at Chosen food is unbelievable, we’re always exploring we’re always testing and we’re not afraid of failure. So think that gives us a lot of drive to explore new products. And we have access to some of the greatest ingredients in the world,” Perez said. “Sesajal has a very strong innovation mentality. Even though we’re starting to become a very large group and have a lot of vertically integrated operations, we have an entrepreneurial mind at heart.”
Sesajal also hopes to broaden the portfolio to incorporate lower-cost options for consumers, Perez said, citing the cost of avocado oil, the company’s primary ingredient but one that can suffer from supply shortages.
Chosen will focus on new products within the areas of healthy fats, plant-based proteins and ancient superfoods, Perez said.
The hope is to one day be able to effect a massive change in consumers’ diets, a topic that’s personally close to Perez who has family members that have struggled with health issues.
“I have seen firsthand what eating right does to your body, to your energy levels, to your consciousness, that not a lot of people see,” Perez said. “We hope to be a grain in the sand, as we say in Mexico, to contribute to that. We know we are just a speck of dust in the entire food industry, but any way we can contribute to helping people eat healthier, that is a very strong driver. When that’s your driver, magical things happen.”