by CHRIS ROGERS
A San Fransisco-based private equity firm has acquired part of Watkins, a major Winona employer and a 150-year-old apothecary with deep local roots. Under the deal, Swander Pace Capital will carve out Watkins’ lines of home and personal care products, creating a separate business under the name “J.R. Watkins,” while Watkins, Inc., will continue producing spices and its famous vanilla extract.
The San Fransisco firm announced the deal on January 18. “We are looking forward to building on the legacy of J.R. Watkins to increase its share of the household and personal care category,” Swander Pace Capital Managing Director Heather Smith Thorne stated. Smith Thorne’s company specializes in food, body, and home products from pet food to cosmetics, and Watkins CEO Mark Jacobs stated that the firm will help J.R. Watkins grow its home and personal care business.
In an interview this week, Watkins CEO Mark Jacobs said that Winona jobs will not be affected by the deal. “It should all be business as usual. We’re really excited about our growth potential in Winona. This really allows our team in Winona to focus on growth opportunities in food,” Jacobs said, adding, “Our goal is to triple the company size over the next five years.”
A personal care product is how Watkins founder J.R. Watkins got his start — making pain-relieving liniment out of his Plainview home back in 1868, according to the company’s website. Watkins’ foray into producing spices and extracts really took off, and helped fuel the rise of one of the most successful companies in Winona history. In recent years, the company has taken advantage of its old-fashioned roots to promote all of the modern chemicals that are not used in its home and body care products.
“We’ve been on a nice growth trajectory and still have a lot more growth ahead of us, so I think they were attracted to, really, the growth opportunity and the staying power of the brand and the timelessness of the brand, which speaks for itself after 150 years,” Jacobs said of why he thought Swander Pace Capital was interested in the business. He explained further, “They wanted to get more involved in the personal care and home care side of the business, and that was also the smaller part of our business. Food is a considerably larger part of our business, and we wanted to retain that and we wanted to retain all of the facilities and everything in Winona.”
“J.R. Watkins has always stood for a superior range of products, high caliber of customer service, and extremely loyal customer base,” Smith Thorne stated. “These are tremendous assets for any consumer-facing business and are a major reason we are excited about partnering with this team and brand.”
Jacobs said he will remain involved in the leadership of both companies going forward, and that Swander Pace Capital will help position Watkins for long-term growth.
“I also feel very comfortable that my partners will be good stewards of it,” Jacobs said of Watkins’ legacy. “We want to, obviously, continue on for many generations, as [Watkins] has, without being 100-percent dependent on our family. I think this serves that purpose well. My goal is protecting employees and the companies.”
Jacobs and Swander Pace Capital declined to comment on the financial terms of the deal.