Round Hill Investments: The Power Play For Neeco

In May 2018, the New England Confectionery Company (Necco) was sold to Round Hill Investments for $17.33 million. Necco, an American candy manufacturer, was founded in 1901 through the merger of several small confectionery companies in the Greater Boston area. Round Hill Investments is a real estate investment and management company founded in 2002 by Michael Bickford, a former Morgan Stanley Real Estate Funds professional. Following the acquisition, Round Hill Investments briefly operated Necco under the name of Sweethearts, LLC, before selling off various Necco lines to other candy companies, including Spangler Candy Company.

Round Hill Investments bought Necco for $17.33 million in May 2018

Round Hill Investments LLC, owned by billionaire C. Dean Metropoulos, bought Necco for $17.33 million in May 2018. Round Hill Investments is a fully integrated real estate investment and management company founded in Delaware, United States. The company has 14 offices globally, including in the UK, Germany, the Netherlands, Luxembourg, Spain, Sweden, Ireland, Singapore, and the United States.

Necco, or the New England Confectionery Company, was an American manufacturer of candy created in 1901 through the merger of several small confectionery companies located in the Greater Boston area. The company was best known for its namesake candy, Necco Wafers, dating back to 1847. Other popular products included seasonal Sweethearts Conversation Hearts and brands such as the Clark Bar, Haviland Thin Mints, and Sky Bar.

In March 2018, Necco's chief executive, Michael McGee, announced that unless a buyer was found, most of the company's workforce could be laid off by May 6, 2018. With a workforce of approximately 500, Necco was the largest employer in Revere, Massachusetts, at the time. Following this announcement, online sales of Necco products spiked, with buyers concerned about the potential discontinuation of the candy.

Round Hill Investments purchased Necco out of bankruptcy for $17.33 million in May 2018. However, just two months later, in July 2018, Round Hill Investments abruptly ended operations at Necco, citing "sanitation issues" that it claimed it was previously unaware of. About 230 workers were laid off when the Revere plant closed, and Round Hill sold off various Necco lines to other candy manufacturers.

Necco was an American candy manufacturer, founded in 1901

Necco, or the New England Confectionery Company, was an American candy manufacturer founded in 1901 through the merger of several small confectionery companies in the Greater Boston area. The company was created by three founding members: Chase and Company, founded by brothers Oliver R. and Silas Edwin Chase in 1847; Ball and Fobes, founded by Daniel Fobes in 1848; and Bird, Wright and Company, founded in Boston in 1856. These companies joined forces and moved into a newly constructed manufacturing plant in the Fort Point–South Boston Waterfront area of Boston, Massachusetts, in 1902, becoming the largest establishment devoted entirely to confectionery production in the United States.

The Boston Wharf Company developed a complex of four five-story buildings at 253 Summer Street and 11-37 Melcher Street for the company. BWC named the adjacent streets Necco Court, Necco Street, and Necco Place. In 1907, they added two more buildings behind the existing complex, connected by a four-story interior bridge. With nearby rail and water transportation, the BWC specialised in the shipment and storage of sugar and molasses.

The success of the company prompted them to introduce a profit-sharing plan in 1906, and Necco continued to thrive while the confectionery industry boomed through the turn of the century. In 1927, the company moved to a new factory on Massachusetts Avenue in Cambridge, which was then the largest factory in the world devoted entirely to candy production.

Necco dominated the candy-manufacturing business through much of the first half of the 20th century. During World War II, from 1942 to 1945, the US government requisitioned a significant portion of the production of Necco wafers as they were "practically indestructible" during transit. After the war, Necco continued to expand through acquisitions of small candy companies and the rights to manufacture their trademarked candy bars.

By 2003, Necco consolidated its facilities to share an 810,000-square-foot plant and warehouse in Revere, Massachusetts, which served as its international headquarters. In 2005, the company's annual revenue was around $100 million, and it continued to operate until it was sold in May 2018 to Round Hill Investments LLC for $17.33 million.

Round Hill Investments is an investment and management company founded in 2002

Round Hill Capital, on the other hand, is a leading global real estate investment manager founded in 2002 by Michael Bickford, formerly of Morgan Stanley Real Estate Funds. The company has a presence in major cities across Europe, the USA, and Asia, with 14 offices worldwide. Round Hill Capital has a unique approach to real estate, aiming to create long-term financial and social value by building thriving communities. Their portfolio includes student accommodation, residential properties, and office buildings.

Round Hill Capital has made significant acquisitions over the years. In 2007, they acquired the Vitus Group, a German residential real estate operator with over 30,000 apartments in seven countries. In 2012, they added the Nido Student Living portfolio to their holdings, which included the world's tallest student accommodation building in Central London. They have also acquired office buildings across Europe, totalling 2.5 million square feet.

Round Hill Capital's efficient deployment of insights, technology, talent, and new ideas sets them apart. They have a strong local footprint, providing unparalleled consumer and investment insights. Their culture is driven by a diverse group of sector specialists and market disruptors within the real estate industry and beyond. Round Hill Capital's relationship with CIM Group as a major shareholder also allows them to leverage best-in-class systems and expertise to increase operational efficiency.

Necco was sold due to bankruptcy and sanitation issues

The New England Confectionery Company (Necco) was sold in May 2018 due to bankruptcy and sanitation issues. The company, which was the oldest candy company in the United States, had a long and complex history involving mergers, acquisitions, and financial difficulties.

Necco was created in 1901 through the merger of several small confectionery companies in the Greater Boston area, with its origins dating back to the 1840s. Over the years, Necco grew and became a dominant force in the candy-manufacturing business, particularly known for its namesake candy, Necco Wafers. However, the company also faced financial troubles and was acquired multiple times throughout its history.

In March 2018, Necco's chief executive, Michael McGee, announced that unless a buyer was found, most of the company's workforce could face layoffs as early as May 6, 2018. This sparked concern among customers, and online sales of Necco products spiked. However, the situation only worsened when, in May 2018, the U.S. Food and Drug Administration (FDA) found serious violations of sanitation and health regulations at Necco's manufacturing facility. The FDA's findings included significant evidence of rodent activity and unsanitary conditions, marking the company's fifth citation for rodent infestation.

As a result of these issues, Necco was forced into a bankruptcy auction in May 2018. The winning bid of $18.83 million came from the Spangler Candy Company. However, Spangler ultimately backed out of the transaction, and Necco was sold to Round Hill Investments, owned by billionaire C. Dean Metropoulos, for $17.33 million. Round Hill briefly operated the company under the name Sweethearts, LLC, before announcing the immediate closure of Necco's Revere facility in July 2018, citing the sanitation issues that had been previously uncovered by the FDA. About 230 workers were laid off when the plant closed, and Round Hill proceeded to sell off various Necco lines to other candy companies.

Round Hill sold off various Necco lines to other candy companies

Round Hill Investments purchased the New England Confectionery Company (Necco) for $17.33 million in May 2018. However, Round Hill abruptly ceased Necco's operations just two months later, on July 24, 2018, citing previously unknown "sanitation issues".

Round Hill then sold off various Necco lines to other candy companies. The core Necco product, Necco Wafers, was sold to the Spangler Candy Company of Bryan, Ohio, along with the Sweethearts and Canada Mints brands and the equipment used to manufacture them. The Spangler Candy Company had previously been the winning bidder in the bankruptcy auction before Round Hill stepped in.

In September 2018, Spangler announced plans to bring back the Necco Wafer, initially targeting a November 2019 relaunch date. In May 2020, Spangler announced that the wafers were back in production at a facility in Mexico and ready for release. The wafers returned with a slight change to the formula, with true connoisseurs promised a richer cocoa flavour in the chocolate wafers due to a minor improvement in the cooking process.

Other Necco-owned brands were also sold off. The Clark Bar was sold to Boyer Candy Company, while Candy Buttons were bought by Doscher's Candies. Banana Split and Mint Julep chews, along with Slap Stix lollipops, were sold to Mega Candy Co., and Haviland Thin Mints and Mighty Malt Milk Balls were sold to Log House Food.

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