Greek yogurt maker Chobani receives $750-mn funding from TPG Capital

Chobani, the biggest yogurt maker in the US, has secured a $750 million investment from private equity firm TPG Capital to help fund its growth

Greek yogurt maker Chobani receives $750-mn funding from TPG CapitalAs part of the deal, the New York-based Greek yogurt maker said that TPG will get two board seats, and the company founder and CEO Hamdi Ulukaya will serve as its chairman.

The investment values the company, which competes with yoghurt brands of General Mills and Danone, at around $5 billion.

Citing sources familiar with the deal, The New York Times reported that the investment is in the form of a so-called second-lien loan, but TPG will receive "warrants that may allow it to obtain an equity stake in Chobani of as much as 35 per cent."

''Chobani has experienced tremendous growth and leads one of the most exciting aisles in the supermarket,'' said Ulukaya, in a statement. ''This investment gives us additional resources to build on our momentum, fund our exciting new innovations and reach new people.''

''Hamdi and the team at Chobani have in seven years turned the vision of bringing a quality, nutritious Greek yogurt to America into a highly successful business,'' James Coulter, a co-founder of TPG, said in a statement. ''We look forward to Chobani's future growth and expansion of the brand.''

The New York-based company, which recently denied media reports of looking at an IPO, had hired Bank of America to help in selling around 20 per cent stake in order to fund expansion. (See: US top yogurt maker Chobani mulls selling minority stake)

Ulukaya currently owns 100 per cent of the company.

Turkish immigrant Ulukaya founded Chobani in 2005, but his brand became a sensation in the US after he bought a yogurt plant in South Edmeston, New York, that was put for sale by Kraft Foods.

Chobani makes Greek-type strained yogurt known as "Turkish" yogurt outside the US, and is the top-selling brand of yogurt in the country with a 38 per cent market share of the $7.4 billion US yogurt market, and has revenues of $1 billion.

Chobani expanded in 2012 by opening one of the world's largest yogurt-processing plants in Idaho. The one million square-foot facility cost $450 million and employs 300 people.

Chobani is planning to launch new products, such as a line of organic yogurt, yogurt containing steel-cut oats and desserts, which are expected to be in the market later this year.