Michael Foods, one of the largest players in the U.S. egg industry, is being sold by one private equity owner to another.
The buyer is the private equity arm of Goldman Sachs, the companies said Friday, in a deal that values Michael Foods at $1.7 billion.
The deal includes a wrinkle: Seller Thomas H. Lee Partners, which has owned Michael Foods since 2003, will retain an ownership stake of approximately 20 percent, the announcement said.
"I grant you, that's a bit unusual," said Mark Witmer, treasurer of Michael Foods. "But I think the way to view that is our friends at Thomas H. Lee remain very enthusiastic about our business prospects and are happy to retain a business stake going forward."
Michael Foods ranks as the No. 7 egg producer in the country and claims the market lead in processed egg products to foodservice customers, food companies and retailers. It also markets eggs and potatoes under its own consumer brands, including Crystal Farms and Simply Potatoes. In 2009, it had $1.5 billion in sales.
The company had 3,762 employees in December, with more than 1,000 in Minnesota, including 250 at its office in Minnetonka. Witmer said he expects the company will continue to function as before.
"Really, nothing changes, except a new equity sponsor," Witmer said. But operationally? "No change," he said. The management team will remain in place.