
KKR buys New Zealand's Natural Pet Food from Pioneer

KKR has agreed to acquire New Zealand premium pet food maker Natural Pet Food Group (NPFG) from local private equity firm Pioneer Capital.
Transaction details were not disclosed. KKR will fund the investment from its fourth Asia fund, which closed last month at $15 billion, making it the largest US dollar-denominated private equity vehicle ever raised for the region.
Pioneer acquired a 56% stake in NPFG in 2013 for an undisclosed sum from its second fund, which was mandated to write checks in the NZ$10-30 million ($6.8-20.3 million) range. It had built up to a 77% interest as of September last year. The business is said to have grown tenfold during this period.
“Natural Pet Food Group is a pioneer in New Zealand’s sustainable pet food industry, with a strongly defined mission and set of values,” Michael Robson, a managing director at KKR Capstone who will join the NPFG board, said in a statement. “This investment also reflects KKR’s commitment to supporting fast-growing companies in New Zealand that are seeking opportunities to expand into new sectors, verticals, and markets.”
Founded in 2006, NPFG markets nutritious, high-meat pet food across several dog and cat brands, including K9 Natura and Feline Natural. Products aim to use ethically sourced ingredients such as grass-fed and free-range meat, cage-free chicken, and sustainable seafood. Much of its growth strategy has relied on demographic trends around people living longer, smaller families, and waiting longer to have children.
Expansions during the Pioneer hold include the launch of a mass-market brand called Meat Mates, a greater focus on e-commerce channels, a move to outsource manufacturing, various governance improvements, and professionalization of the sales function. There has also been a strong push to strengthen the international footprint by focusing on core markets. Operations currently span New Zealand, Australia, China, Japan, the US, and Canada.
Across brands, the geographic split for sales is about 40% Asia, 30% Australasia, and 30% North America. China is considered one of the most important growth markets, especially in terms of cat products. The country’s overall pet food market is estimated to be worth about $13 billion a year, with a high-meat segment growing at 150% a year. NPFG plans to leverage a warm trading relationship between China and New Zealand to realize a seamless rollout.
“There’s no reason for us to worry about going through a gray market and the issues that creates,” Neil Hinton, CEO of NPFG told AVCJ last year, noting that the New Zealand Trade & Enterprise Shanghai has already facilitated in-country sales. “We’ve been able to go in through the front door with a very strong reputation and say, ‘We’ll do this by the book.’ Once you achieve your registrations, you have a much clearer, open access to the market.”
Pioneer typically makes investments in a range of NZ$10-50 million, taking minority or control stakes. As of February, it had raised NZ$100 million for its fourth fund, which is targeting NZ$260 million. It has historically placed a strong emphasis on premium grocery brands that can leverage New Zealand’s reputation for food safety and environmental consciousness. More than 90% of the firm's combined portfolio sales have come from overseas.
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