Blue Point Capital has a lot of experience in the food and beverage space, so it was natural that the Cleveland-based PE firm would jump at the chance to acquire Water Lilies, a 27-year-old private label manufacturer of premium frozen Asian-inspired food.

Blue Point Partner John LeMay says the firm liked the product, market mix and the company's path to market. And because two of Blue Point's operating partners have direct relevant experience in the space, the firm was able to get comfortable with the asset quickly, which led it to take an aggressive posture on the deal in 2022.

LeMay says the firm liked the product, market mix and the company's path to market.

"Specifically, we like the fact they were in ethnic food, which is seeing higher growth rates; snacking — sort of a better for you, cleaner label profile; and then with a heavy focus on private label in the frozen space, which I think is a nice growth area," he says. "The management team, led by Peter Lee, was very impressive, so that drew us into the deal as well."

Additionally, two of Blue Point's operating partners, Clarence Mou and Angelo Fraggos, have directly relevant experience in the space. Mou's family business, Discovery Foods, was a frozen Asian appetizer business. Fraggos had been worked with him in that business, so LeMay says the two had very specific views on the industry, knowledge of the equipment and a path to market.

"So, we're able to get really comfortable with the asset quickly and with a value-add plan that made sense," LeMay says.

Given Blue Point's interest in the company, the insight provided by the two operating partners and that the business fit a lot of the firm's criteria, LeMay says Blue Point took an aggressive posture on the deal.

"After our first interaction with management, we kicked off all phases of our diligence effort and were able to come to the LOI date with a fully underwritten deal and were able to close 12 days after signing a letter of intent," LeMay says. "This was really built on this being a perfect fit for our food and beverage practice, and then the increased comfort that came with our with our operating partners."

DealTalk host Michael Marzec sits down with LeMay to discuss in more detail the private equity firm's acquisition of Water Lilies.