High Road Acquires Three Twins Plant, Plans for Expansion

Earlier this year in April, ice cream brand Three Twins announced it would be closing its doors with its assets sold to pay down creditors. Now the company’s former Wisconsin factory has a new owner, High Road Craft Brands. The deal comes as High Road gears up for an ambitious distribution play, aiming at an eventual roll-up of other ice cream companies.

High Road purchased the 25,000 square foot plant from a trust handling the disposition of the Three Twins assets; the purchase price was not disclosed. Until now, High Road has operated solely out of its 75,000 square foot plant in Marietta, Georgia.

High Road founder and CEO Keith Schroeder said that although gaining new production capability was appealing, the caliber of the staff who had worked for Three Twins was what cemented his decision. Both Three Twins plant manager Nathan Dehne and director of food safety Keston Heinen have returned to work under High Road. Though many had already accepted new jobs, Schroeder estimates that 40% of the 24 person plant staff will be returning employees.

“We decided to buy the plant largely because of the caliber of the team,” Shroeder said. “Wisconsin just has manufacturing in it’s bones…It took us ten years to build the scale of knowledge that seems fairly readily available in Wisconsin.”

Though Schroeder said he had “deep respect” for Three Twins, the company was not interested in purchasing the brand name or product recipes because the brand, he said, was so tied to founder Neal Gottlieb that High Road “would not be able to credibly continue on his vision.”

The company currently has four brands (High Road, Wallops, Ciao Bella and Helados la Neta) as well as a strong business crafting private label products, which currently accounts for the majority of revenue. Schroeder said he also is considering acquiring a non-dairy offering in 2021, following the success of Ciao Bella. While the company’s brands are sold in 8.000 retailers including Whole Foods, Albertsons, Safeway, The Fresh Market, Walmart and Sam’s Club, Schroeder said that it has been difficult at times to make national distribution from its Georgia plant work financially.

“Our ultimate strategy is to make sure that High Road can deliver in three corridors,” Schroeder said. “Where we, like every other ice cream company, struggle is [when we] try to get [our] product coast to coast to recognize any meaningful margin. And so it has become our belief that a three lane strategy of East, Center and West is critical to becoming an attractively profitable organization.”

Down the line, High Road would like to open a third plant in Nevada, New Mexico, Arizona or Utah.

2021 will also see a multi-million dollar investment into adding new production lines for molded and extruded stick novelties. Though that project is subject to finding new financing, Schroeder feels confident that the capital will be available to make the addition happen as well. Up until now, the company has been financed by an undisclosed family office (which shares ownership with Schroeder) and through debt financing. Moving forward, he said, the ultimate goal is to be the keystone of a larger acquisition.

“We believe our management team is set up to become the management team of the next large independent ice cream company in the country,” Schroeder said. “We’d like to be the hub for a roll up strategy because we believe that consolidation is inevitable.”