Truelink Capital nears $1 billion deal for coffee syrup maker Lyons Magnus

Lyons Magnus revenue nearly doubled to over $1 billion since 2017

Truelink Capital is nearing a deal to acquire Lyons Magnus, a California-based maker of coffee syrups and fruit-based ingredients, in a transaction valued at about $1 billion including debt, according to people familiar with the matter.

An announcement could come as soon as Monday, barring any last-minute snags, the people said.

Lyons Magnus, based in California, traces its roots back to 1852. The company specializes in making flavored ingredients and beverages, including coffee syrups, smoothie bases, ice cream toppings, nutritional drinks and fruit purees. Its customers in the food-service industry include restaurant chains and coffee shops.

Truelink, a buyout firm based in Los Angeles, is set to acquire Lyons Magnus from Paine Schwartz Partners, a private-equity firm that bought the business in 2017.

Since that acquisition, Lyons Magnus has acquired a handful of smaller businesses — including some operations from Hormel Foods — to expand its commercial operations and serve more customers, including those in the healthcare sector. The company has also nearly doubled its annual revenue to over $1 billion during that period, according to some of the people familiar with the matter.

Truelink is a midmarket private-equity firm focused on investing in business services and industrials. The firm in March raised $2 billion for its latest fund, Truelink Capital II, exceeding its $1.5 billion target and closing at its hard cap. Kirkland & Ellis represented Truelink on the fundraise.

Paine Schwartz has a history of investing in sustainable food chains, with portfolio companies that include cold-pressed juice maker Suja Life and plant-based dough producer Urban Farmer.

The sale of Lyons Magnus would follow other recent deals in the ingredients space. In May, International Flavors & Fragrances agreed to sell its food-ingredients business to buyout firm CVC Capital Partners in a deal that valued the division at more than $4 billion, including debt. The following month, U.S. food-and-beverage ingredients maker Ingredion struck a $3.6 billion deal to buy U.K. rival Tate & Lyle.