You are currently viewing Lancaster divests Bantam Bagels of ‘Shark Tank’ fame amid challenging quarter

Founders Nick and Elyse Oleksak of Bantam Bagels turned their ‘fifteen minutes of fame’ on Shark Tank in 2015 into a multi-billion dollar opportunity. While the couple described their appearance on the popular TV programme as “the scariest moment in Bantam history” ​– especially as its online sales platform crashed from a traffic surge after the episode aired – it led to a $34m sale to T. Marzetti Co., a subsidiary of Lancaster, in 2018.

At the time, Lancaster’s president and CEO David Ciesinski described the New York City-based Bantam – which was posting around $20m in annual sales – as “a fast-emerging company that provides us with an entry into the large and growing frozen breakfast category.”

Founded in 2013 as a retail shop, Bantam Bagels Bantam Bagels is best known for its frozen bite-sized stuffed bagels and mini stuffed pancakes, garnering praise from celebs like Oprah and actor Steve Harvey.

The company had also cemented a relationship with Starbucks (listed in more than 9,000 stores across the US), another positive that Ciesinski believed positioned it for future expansion.

Result of COVID

Four years later, however, in a statement accompanying its fiscal year third-quarter financial results, Lancaster said Bantam has underperformed and has no foreseeable path to profitability.

The Ohio-based food producer partly attributed a hammered third quarter bottom line to a noncash restructuring and impairment charge of $22.7m for the Bantam Bagels business.

For the third quarter ended 31 March, Lancaster sustained a loss of -$4.48m, compared to +$28.9m (equal to $1.05 per share) in the same period a year ago. For the nine months ended 31 December, Lancaster’s net income was $60.54m ($2.20 per share), down 45% from $110.61m ($4.02 per share).