Although the financial bailout may hit $1 trillion and the market is kissing 8,000, RBC Capital Markets quietly rolled out a $185 million loan yesterday that backs the leveraged buyout of Earthbound Farm, a San Juan Bautista, Calif.-based organic produce company, by private equity firm Lindsay Goldberg, according to sources. Terms of the buyout and financing package have not circulated widely. Bank of America has committed to the deal, along with BMO Capital Markets. The BMO ticket has some conditions attached to it, sources note. Earthbound Farm was the first company to successfully launch pre-washed bagged salads packaged for retail sale in 1986. The company sells more than 100 varieties of organic salads, fruits and vegetables across 75% of supermarkets nationwide, according to Earthbound. Its main farms are located in California, Arizona, and Mexico. The company also grows organic produce in Colorado, Washington, Oregon, Canada, Chile, and New Zealand.
Why is this important? Earthbound Farms is the parent company of Natural Selection Foods Inc., which manufactured the Dole Baby Spinach that sickened 205 in an E. coli outbreak in 2006. To date we have settled nearly 100 cases, but have 5 more to resolve through settlement or trial. It is good to see they are setting aside some cash for the victims of this tragedy.