Tate's Bake Shop To Be Sold For Nearly $500 Million

The company behind such brands as Oreo cookies, Trident gum, belVita biscuits and Cadbury Dairy Milk chocolate this week acquired Tate’s Bake Shop of Southampton, the latest giant international step forward for a venture that began on a North Sea farm.

The deal, worth nearly $500 million, was announced this week by Mondelez International and is expected to be finalized sometime this summer.

Mondelez International, which is based in Deerfield, Illinois, and has products in roughly 160 countries, touts itself as “building the best snacking company in the world,” according to the press release, and in 2017 reported approximately $26 billion in revenue.

Tate’s Bake Shop, which opened in 2000 and is still partially owned by founder Kathleen King—and named for her father, Richard “Tate” King, who died in 2016—is best known for its all-natural baked chocolate chip cookies, cakes, brownies and pies. After an earlier deal expanded its operations, Tate’s products are sold nationally in grocery and specialty food stores, and in various locations throughout the East End and Long Island—including its busy base of operations in Southampton Village—and online.

Ms. King, 59, started selling cookies when she was 11 years old on the North Sea farm owned by her father to pay for her own school supplies. With modest dreams of owning a car and having her own apartment, at the age of 20 she started her own business called Kathleen’s Bake Shop, which came to an end after a tangled relationship with business partners.

Forced to start over, she named the new shop after her father, who earned the nickname “Tate” while picking “taters” on the family farm as a young boy.

In 2007, Ms. King moved the Tate’s baking operation to a 15,000-square-foot building on Montauk Highway in East Moriches. “I really just wanted to be the best cookie in America,” she said on Tuesday.

And she was. In 2013, Tate’s Cookies were named the best cookie in America by Consumer Reports, and, the following year, the Riverside Company, which was founded in 1988 and focuses on acquiring and investing in growing businesses valued at up to $250 million, made a substantial investment in Tate’s Bake Shop, in an effort to expand the marketing and product location for what was already a nationally retailed bakery. The partnership was designed to enhance distribution, production and manufacturing for the company.

In 2015, Riverside moved a big portion of distribution to the Hampton Business District, an incubator at Francis S. Gabreski Airport in Westhampton. A press release said Tate’s will continue to produce all products at its current manufacturing facility in East Moriches.

“Mondelez International will operate Tate’s as a separate standalone business to nurture its entrepreneurial spirit and maintain the authenticity of the brand while providing resources to accelerate growth,” a press release said. “Tate’s Bake Shop senior leadership will continue to run the Tate’s business from its headquarters on Long Island, including its Bake Shop located in Southampton.”

“We’re thrilled and humbled to be joining a portfolio of some of the world’s most well-known and successful snacking brands,” Maura Mottolese, the chief executive officer of Tate’s Bake Shop, said in a press release. “Consistent with Mondelez International’s purpose to create more moments of joy for consumers, providing an authentic, delicious indulgence has been at the heart of Tate’s Bake Shop since Kathleen [King] first opened her storefront nearly two decades ago. Now, together with Mondelez International, we’ll have the opportunity to take Tate’s to the next level and offer our cookies and baked treats to many more consumers across North America.”

On Tuesday, Ms. King reflected on her journey to this point, and at times was emotional.

When starting out, she said, she would work 18-hour days, seven days a week, and the hard work paid off.

“It’s just something I can be proud of, because the Tate’s brand generated this type of interest,” Ms. King said. “I feel that the Tate’s brand is going to be an international brand, and is going to be my legacy. That’s very rewarding.”

Since the Riverside Company invested in Tate’s, Ms. King has been a board member and has continued to create new recipes. With the sale announcement this week, she plans to retire.

“Tate’s is a great strategic fit that will complement our portfolio of beloved snacks brands,” Dirk Van de Put, chairman and chief executive officer of Mondelez International, said in a press release. “With a unique and authentic brand and truly delicious products, this acquisition gives us an attractive entry point into the fast-growing premium cookie segment.”

“Tate’s has demonstrated exceptional and very profitable growth, and we look forward to working with the Tate’s management team to expand distribution and build upon that success,” he added.

With Tate’s reaching international status, Ms. King said she is thankful to Southampton.

“I had a really interesting journey with a lot of ups and downs,” she said. “I’m just really grateful to be here in Southampton, because the people here always support me and help me when I’m down and when I’m up.”