- A measure of earnings nearly doubled last year, documents show
- Hamdi Ulukaya helped establish Greek-style yogurt in US market
The entrepreneur who popularized Greek yogurt in the US has seen his net worth rise to $2.5 billion as earnings at emerging dairy heavyweight Chobani LLC nearly doubled last year.
Hamdi Ulukaya owns just under 78% of New Berlin, New York-based Chobani, best known for its Greek-style strained yogurt. The company has expanded into oat milk, coffee creamer and drinkable yogurt in recent years, drawing in a broader range of customers. Chobani is Ulukaya’s main asset and source of his fortune, as calculated by the Bloomberg Billionaires Index.
Chobani generated $2.53 billion in net sales in 2023, up 12% from a year earlier, according to bond offering documents reviewed by Bloomberg. At the same time, a measure of earnings rose 96% to $404 million as the company cut costs and streamlined its supply chain.
The figures were disclosed to debt investors Tuesday as part of a junk bond sale. The deal, which raised $650 million, will help redeem preferred equity owned by the Healthcare of Ontario Pension Plan.
The pension plan’s minority stake in Chobani dates to 2018, when TPG Capital exited an earlier investment that helped the yogurt maker avoid a cash crunch. The share redemption will see the pension’s stake drop from about 17% to 7.6%.
Chobani didn’t respond to requests for comment on the bond sale and Ulukaya’s net worth.
The company said demand for consumer goods has remained strong this year and inflationary pressures — like those from commodities and labor costs — remain manageable. Chobani’s flagship Greek yogurt has dominated the US market since 2020.
Yogurt Billionaire
Ulukaya founded Chobani almost two decades ago in upstate New York after immigrating from Turkey. Struck by the poor quality of yogurt available at US grocers, he took out a Small Business Administration loan and bought a shuttered factory.
Chobani’s thick, minimally sweetened yogurt products were a quick success. They helped distinguish Greek yogurt as its own niche in the US and marked a rare example of innovation in consumer dairy snacks. By 2012, Chobani controlled 17% of the US yogurt market and Ulukaya was a billionaire.
Earlier plans to sell the company or take it public have fizzled. Ulukaya weighed selling to PepsiCo Inc. about eight years ago but discussions broke down over the billionaire’s willingness to part with a majority stake. Chobani filed for an initial public offering in 2021 but did not go forward with the deal.
Chobani tapped the high-yield market with a relatively rare bond structure known as holdco PIK, short for payment-in-kind, a feature sometimes seen in riskier deals. The debt is tied to Chobani’s holding company rather than a revenue-generating unit and gives it the option to defer cash interest payments.
The bond priced at a yield of about 9% and will carry a slightly higher coupon if the PIK option is exercised, according to a person familiar with the matter, who asked not to be named because the discussions are private.
Chobani told investors Tuesday it plans to defer its first cash coupon, according to different people familiar with the matter.
— With assistance from Gowri Gurumurthy
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