It was announced Tuesday that kosher food company Manischewitz has been purchased by Sankatay Advisors, a division of Bain Capital and a previous creditor of Manischewitz‘s , for an undisclosed sum. This is the fourth time that the company has been sold in the last twenty three years.
Manischewitz is a 126 year old company known for its kosher wines, matzo and other kosher products. It is headquartered in Newark New Jersey.
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Bain Capital is a private equity firm known most recently for its former partner, former U.S. presidential candidate Mitt Romney. Bain Capital manages more than $75 billion in assets. Bain hopes to help Manischewitz expand beyond a simply Jewish market.
Manischewitz products can be found in most Jewish households in America that observe kosher dietary laws. The company started in 1888 in Cincinnati Ohio as a matzo bakery. On Passover no leavened bread may be eaten. This rule extends to any products made with grains. Kosher for Passover foods may not be made with grains, with the exception of Matzo and products made with matzo.
Due to the laws regulating what is kosher for Passover, special delicacies have evolved which are made only with potato starch and other grain substitutes. Some of these foods are popular all year round and are not only eaten on Passover. Other products that Manischewitz produces, such as gefilte fish, are year round delicacies that are also kosher for Passover since they are never made with grains.
The kosher for Passover stamp therefore in many cases means grain free, other than for matzo products themselves. This makes these foods attractive to a wide market of people looking for gluten free products. While only an estimated 3% of the U.S. population suffers from gluten intolerance, many more believe that it is in some way unhealthy or simply bad for one’s diet.
Bain Capital has been charged in the past with only buying companies to pare them down to make the companies more profitable and, therefore, more attractive for resale at a profit. Sankaty Advisors, however, maintain that they intend to preserve the brand as it is and to expand the company into new markets.
Mark Weinstein, a senior manager with FTI consulting, has been appointed the interim chief executive of Manischewitz. Mr. Weinstein explained that a kosher certification is not only important to people who observe the dietary laws of kashrut. It also tells the consumer that the product meets a higher standard of quality. The consumer may not trust the accuracy of listed ingredients. But once the kosher seal is included then he or she will believe that it must certify the accuracy of a product’s contents.
Mr. Weinstein hopes that this will help Manischewitz expand into new markets. As he told the New York Times, “It’s a pretty powerful certification to be kosher, because it means you are holding your products to a higher standard.”
Manischewitz’s chief Rabbi, Yaakov Y. Horowitz echoed Mr. Weinstein’s sentiments to Israel’s Haaretz daily newspaper. “There is, I believe, a consensus among American consumers that the more supervision the better. There was always a good feeling in American culture about kosher, ” he told Haaretz.
More than 70, 000 products that carry some sort of kosher certification are now available in the U.S. Market. This represents more than a 2, 300% rise since 1970. It is clear to manufacturers that Jews are not the only market for kosher foods. Some brands are promoted as kosher, while most simply apply a kosher label.
Currently, Manischewitz says that 60% of its products are placed by supermarkets in their kosher foods sections. The company intends to introduce new products in addition to its existing line in an attempt to break into new markets and have its products placed amongst their counterparts throughout supermarkets.