Exhibit 20
NEWS RELEASE
Heinz to Acquire 19.5% of Hain Food Group;
Global strategic Alliance Part of Heinz and
Hain Growth Strategies; Hain Acquires
Earth's Best Baby Food Brand from Heinz
Pittsburgh, PA and Uniondale, NY -- September 27, 1999 -- H.J. Heinz
Company (NYSE:HNZ) and The Hain Food Group, Inc. (Nasdaq:HAIN) today announced
an agreement to form a strategic alliance for the global production and
marketing of natural and organic foods and soy-based beverages. This nearly $100
million investment by Heinz will give it a minority stake (19.5% or 3.5 million
shares) in Hain and was based on a per-share purchase price in excess of the
$28.4375 closing price of Hain stock on Friday, September 24, 1999. Further,
Heinz will provide procurement, manufacturing and logistic expertise while Hain
will provide marketing, sales and distribution services.
The natural and organic food category represents a $20 billion U.S.
business growing at 15 to 18 percent annually. Hain is projecting more than $300
million for the current year, following revenues of $206 million in the year
ended June 30, up from $104 million the prior year. Hain is the U.S.A.'s leading
natural and organic food company, with more than 3,500 products offered under
such well-known names as Health Valley cereal, bakery and soups; Terra Chip
snacks; and Westsoy, the largest soy beverage marketer.
"This strategic alliance thrusts Heinz into the natural and organic food
segment, which is among the fastest growing in the international food industry.
Heinz is the first major U.S. food company to gain such direct access to natural
food retail stores. We see attractive opportunities for us in our global
markets," explained William R. Johnson, Heinz president and chief executive
officer. "We will marry Heinz's great strength and scale in low-cost
international procurement, manufacturing and logistics with Hain's talent and
success in the marketing, sales and distribution to specialty food outlets. The
resulting sales growth and cost synergies will benefit shareholders of both
Heinz and Hain and will be accretive to the earnings per share of both companies
in the first year."
As part of the strategic alliance, Heinz will be represented on the
expanded Hain board of directors by Joseph Jimenez, president and CEO of Heinz
North America, and Malcolm
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Ritchie, executive vice president of the H.J. Heinz Company and president Heinz
Europe. Heinz and Hain will exchange some technical and management personnel in
collaborative research and manufacturing programs. Additionally, Hain will
acquire from Heinz the trademark and name for Earth's Best organic baby foods.
"I am happy that Hain has forged this alliance with one of the world's
foremost food companies. Hain has been marketing and distributing Earth's Best
products since 1998; we have increased sales by more than 25% and believe there
is great global potential for the brand beyond infant feeding," noted Irwin
Simon, president and CEO of Hain. "This alliance is a strategic fit with our
expanding product line, and we have some of the strongest names in the natural
and organic food industry with great growth opportunities internationally and
domestically."
The $20 billion U.S. market for natural and organic foods includes $12
billion in sales in specialty stores (natural and organic food shops) and $8
billion through traditional supermarkets. Hain has number-one or number-two
market shares in 11 of the top 15 natural and organic food categories.
"With growing consumer demand for natural and functional foods in North
America, Heinz and Hain will form a powerful global team. This will enable Heinz
to leverage the Hain sales and distribution network to drive functional food
sales in North America," Mr. Jimenez said.
Mr. Simon added: "Traditional supermarkets, drug stores and mass
merchandisers are rapidly expanding their natural and organic product offerings
and, by joining with Heinz, we will grow and, at the same time, reach economies
of scale in production and improve our supply chain. And, with the resources and
global capabilities of Heinz, Hain will be positioned for the first time to
satisfy the growing international demand for healthy foods and snacks."
"We expect to greatly extend our European sales in this segment as a result
of the Hain partnership, which gives us access to the rapidly growing natural
and organic food business, in addition to other items in the cereal, snack,
condiment and baked goods categories," explained Mr. Ritchie.
The alliance with Hain complements Heinz's worldwide portfolio of brands
that meet special nutritional needs. The $100 million Heinz range includes an
array of gluten-free and
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other special diet products made by Heinz Italy under the brand names Bi-Aglut,
Aproten and Dieterba. Additionally, it offers Complan and Glucon D nutritional
drink mixes, sold in India and parts of Europe and South Africa. "We will expand
sales of these foods in the United States through Hain's outstanding marketing
and distribution network," Mr. Simon explained.
"The goal of our strategic alliance is to heighten consumer awareness of
the benefits of natural and organic food and make Heinz a global leader in this
profitable segment of the industry," Mr. Jimenez said. "Heinz has been known as
the pure food company since its founding. This partnership with Hain positions
Heinz in the forefront of one of the leading consumer trends in the food
industry."
Heinz and Hain have worked together on other products for the past two
years. Hain manufactures, markets and sells certain Weight Watchers brand dry
and refrigerated products under a 1997 licensing agreement with Heinz. The line
includes salad dressings, canned soups, sauces, cookies and mayonnaise, among
other items. Also in 1997, Hain acquired from Heinz the Alba Foods line of
regular and non-fat dry milk products, cocoa mixes and dairy shakes.
This transaction is subject to customary regulatory approval.
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The above contains certain forward-looking statements which are based on
management's current views and assumptions regarding future events and financial
performance. For Heinz, reference should be made to the section "Forward-Looking
Statements" in Item 1 of H.J. Heinz Company's Annual Report on Form 10-K for the
fiscal year ended April 28, 1999 for a description of the important factors that
could cause actual results to differ materially from those discussed above. For
Hain, certain of the statements in this press release are forward looking in
nature and, accordingly, are subject to risks and uncertainties. The actual
results may differ materially from those described or contemplated.
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ABOUT HEINZ: With sales over $9 billion, H.J. Heinz Company is one of the
world's leading food processors and purveyors of nu-
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tritional services. Its 50 affiliates operate in some 200 countries, offering
more than 5,700 varieties. Among the company's famous brands are Heinz,
StarKist, Ore-Ida, 9-Lives, Weight Watchers, Wattie's, Plasmon, Farley's, Smart
Ones, The Budget Gourmet, Rosetto, Bagel Bites, John West, Petit Navire, Skippy,
Kibbles 'n Bits, Pounce, Wagwells, Nature's Recipe, Orlando, Olivine and
Pudliszki. Information on Heinz is available at http://www.heinz.com.
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ABOUT HAIN: The Hain Food Group, headquartered in Uniondale, NY, is a natural,
specialty and snack food company. The Company is a leader in many of the top 15
natural food categories, with such well-known natural food brands as Hain Pure
Foods(R), Westbrae(R), Natural, Westsoy(R), Arrowhead Mills(R), Health
Valley(R), Breadshop's(R), Casbah(R), Garden of Eatin(R), Terra Chips(R),
DeBoles(R), Earth's Best(R), and Nile Spice. The company's principal specialty
and snack food product lines include Hollywood(R) cooking oils, Estee(R)
sugar-free products, Weight Watchers(R) dry and refrigerated products,
Kineret(R) kosher foods, Boston Better Snacks(R), Harry's Premium Snacks and
Alba Foods(R). Hain's Internet web site is www.thehainfoodgroup.com.
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