Now in its 107th year of business, Legacy Bakehouse is entering a new period of growth. The Waukesha-based manufacturer began as a small bakery run by German immigrants and has since grown into one of the country’s largest producers of baked snack components – an evolution not without its
challenges.
The maker of breadsticks, rye chips, snack mix, croutons and more is currently on track to nearly double its workforce and production capacity, in large part due to the financial backing of Benford Capital Partners, the Chicago-based private equity firm that acquired the company in 2023.
Just a year after the acquisition, Legacy in July bought a 42,000-square-foot facility in Cudahy, the site of the former Angelic Bakehouse, on East Layton Avenue. The $5.5 million purchase of a second production site is just the start of a series of investments, including new technology and production lines, to support the company’s growth.
While the introduction of new technologies over the years has streamlined the process of baking fresh bread for snack ingredients, the business itself has remained mostly the same, according to Legacy Bakehouse president Peter Sardina, who has been with the company since the 1990s.
“As far as the physical part of the business, we basically have different equipment,” said Sardina. “As far as the atmosphere and the culture of the company, I don’t think (Legacy has) changed much.”
As Legacy anticipates double-digit growth in 2025, Sardina is shepherding the business through its latest period of expansion while also helping it maintain its longstanding heritage and a culture that prioritizes employees.
“We care about our people,” said Sardina. “That’s our main goal. I want you to come in to work and go home safe to your family.”
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The former angelic bakehouse facility that legacy purchased in July.[/caption]
Small town roots
Legacy Bakehouse began as a small, family-owned German bakery, called Pinahs, in Milwaukee in 1917. The business made traditional German rye breads, sweets and more.
In the 1970s, snack mixes started to become more popular with American consumers. Pinahs broke into this market by creating a rye chip from its homemade bread.
“They used to make rye chips for kids, and people really loved that product,” said Sardina. “From there, (Pinahs) kept on growing in that category.”
The company opened its current Waukesha headquarters, at N8 W22100 Johnson Drive, in 1991. Faced with financial challenges during the late ‘90s into the early 2000s, Pinahs filed for receivership in 2007; it was purchased and renamed as Legacy Bakehouse shortly thereafter.
Today, about 90 people work at Legacy’s Waukesha headquarters facility, where fresh bread is baked round the clock. Its newly acquired Cudahy facility will eventually have a team of 100 employees.
Joining Pinahs as a plant manager, Sardina was tasked with helping manage the business and developing new products. At the time, the company’s only product was its flagship rye chips. The manufacturer has since added modern snack staples like pita chips, flour tortillas and, its most popular product, bagel chips. Legacy makes several variations of bagel chips including multigrain and clean label, a product that uses a short list of ingredients with minimal artificial additives.
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Peter Sardina[/caption]
"We care about our people. … That’s our main goal. I want you to come in to work and go home safe to your family.”
The original Pinahs moniker lives on as now the only brand Legacy owns. Pinahs Rye Chips and Snack Mixes are manufactured and packaged at Legacy’s Waukesha location for distribution to retailers nationwide.
Historically, Legacy Bakehouse has been a bulk supplier that ships components to clients that then combine those pieces into snack mixes themselves. As it expands its capabilities, the company will soon be able to produce customized snack mixes for its clients in-house.
Legacy’s latest product addition is a checkered square product made from corn. The checkered morsel, made from dry corn pellets that have been imported from Europe, can be uniquely flavored and added to any sort of snack mix.
“That innovation shows where we are headed,” said Inderjit Kang, chief operating officer at Legacy Bakehouse. “That corn piece is part of the end solution to provide the entire snack mix to a customer.”
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Inderjit Kang[/caption]
"We are a co-manufacturer that has a good quality product at a low cost, and we can basically produce and be fast and flexible to deliver on time every time.”
Last year, Legacy manufactured approximately 12 million pounds of its baked products. The company’s Waukesha site has capacity to make up to 20 million pounds of product, with the Cudahy site capable of adding 10 to 15 million pounds to that total.
“We are a co-manufacturer that has a good quality product at a low cost, and we can basically produce and be fast and flexible to deliver on time every time,” said Kang. “That’s the key for the success story.”
A complete turnaround
Waukesha-based Z.T. Distribution has been working with Legacy for more than 20 years as the exclusive distributor of the Pinahs brand. Company president Scot Trojanowski witnessed firsthand the massive turnaround Pinahs experienced, recovering from bankruptcy to once again becoming a baking powerhouse.
Z.T. Distribution distributed for Chris Pinahs, the third-generation family owner of the Pinahs business, as far back as the 1990s, although the companies did not have an exclusive agreement in place at that time.
“There was some challenged decision-making by the original owner that put the company in jeopardy,” said Trojanowski.
Pinahs hit financial trouble when it lost a supply contract with Gardetto’s Bakery after the longtime Milwaukee snacking company was sold to General Mills in 1999. Pinahs went into receivership in 2007 and then was purchased by Mike Heyer, then-owner of Racine Danish Kringles, along with a group of investors. The new ownership group changed the company’s name to Legacy Bakehouse.
“We reinvigorated the (business) relationship when the new ownership team came in, with Mike (Heyer) and Peter (Sardina) heading things,” said Trojanowski. “We all had aligning goals. Both our companies were growing at the same time.”
Despite Legacy’s comeback success, the company was constrained by the physical space it had available at its Waukesha headquarters, he explained.
Trojanowski had approached Legacy to discuss producing and packaging additional brands but found the business couldn’t take on more work.
“They just didn’t have the ability to even consider a new project because they were so busy,” said Trojanowski. “When I heard they bought the Angelic property, I said, ‘That’s brilliant.’”
He believes Legacy’s second site will be a boon for the business as it can expand its packaging capabilities and brand development partnerships.
Right now, Z.T. Distribution is preparing for the Pinahs brand’s busiest season: the holidays. Employees are working to build out the large retail displays needed to keep Pinahs Rye Chips in stock. Demand for the brand will at least quadruple during the season, according to Trojanowski.
“Rye chips can be divisive. People either love or hate them,” he said. “When you talk to people, it’s the first thing they pick out of a snack mix.”
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Growth of snack foods
Legacy’s growth can be attributed in part to a major consumer trend: Americans’ growing love for snack foods.
The salty snacks category grew 6.9% in 2023 with more than $31.1 billion in sales reported, according to SNAC International’s 2024 State of the Industry Report. Snack mixes are ranked among the 15 most popular snack options, raking in an estimated $1.59 billion in sales last year.
More than one-third of consumers “use snacks as a key ingredient in no-prep dinners” multiple times a week and some are even integrating their favorite snacks into meals, according to the report.
“Snacks are one of the fastest-growing categories. That’s what major food companies are focused on,” said Alain Vallet-Sandre, chief commercial officer at Legacy. “These types of shelf-stable products are primarily consumed for convenience, and that’s just the way that people eat these days.”
To that end, Legacy is currently using its newly acquired Cudahy facility to produce fresh-baked tortillas that later become components in frozen meals. Legacy can produce 140 tortillas per minute using a simple dough made from all-purpose flour and oil, and a press line once used to make sprouted grain flatbread. It’s one example of how the company is creating new uses for the equipment Angelic Bakehouse formerly used to manufacture its breads, rolls, wraps and other sprouted whole grain baked goods.
“Our original thought was we would run pita because it’s very similar to a tortilla,” said Vallet-Sandre. “We quickly received some direction from folks that there was a need for tortilla capacity, so that’s where we focused.”
Legacy is currently producing two types of tortilla – a traditional flour version and a lower-carb option – for one customer out of the Cudahy plant.
As a contract manufacturer, Legacy doesn’t often get to decide what kinds of food it produces, rather the business focuses on fulfilling orders from its clients. This requires Legacy to keep an eye on larger trends in the snack market, including rising demand for gluten-free products – a segment the company has considered but not yet broken into – as well as organic products.
“We make ourselves available to what the market needs,” said Vallet-Sandre.
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Private equity ownership
Since Benford Capital acquired Legacy Bakehouse in April 2023, the manufacturer has seen double digit growth in both revenue and EBITDA, according to Rupal Patel, operating partner at Benford Capital. The company also anticipates double-digit growth in 2025.
Benford Capital typically looks to invest in companies that are under $100 million in revenue, for a typical hold period of between five and seven years. During that time, Benford aims to at least double the size of its platform companies.
“(Legacy) was very much in our niche area,” said Patel. “Food manufacturing is at our core.”
Legacy’s former ownership team decided to start planning for retirement in 2022. With no family members readily available to take over the business, private equity was the option that made the most sense, Sardina explained.
“Benford Capital, what they brought to the table ... it wasn’t money. There were people with bigger offers, but the owners wanted to make sure that Legacy kept going,” Sardina said. “Benford was the best group to address the future of the company.”
Benford Capital takes a “partnership-based” approach with its portfolio companies, said Patel. The firm believes in investing the money necessary to drive commercial growth and capacity expansion.
In addition to the $5.5 million spent to buy the Cudahy facility, Benford Capital also purchased a custom-made toaster dryer that has allowed Legacy to double production capacity for its rye and bagel chips at its Waukesha headquarters. The company declined to share the dollar figure of that investment.
“The acquisition of the Cudahy facility from Angelic Bakehouse was an add-on acquisition we did because we really saw a good fit in terms of the capability of the equipment as well as the team’s core competency,” said Patel. “We have a proven playbook for food and beverage manufacturing companies of this size.”
Expanding to Cudahy
It only took a matter of days for Legacy to acquire the assets of the former Angelic Bakehouse facility. The company shut down in March after its owner, Ohio-based T. Marzetti Company, exited the business, saying its products didn’t meet financial expectations.
In June, Sardina had learned about an auction taking place at the Angelic Bakehouse site. He quickly headed over to look at the available equipment, taking particular interest in the tortilla press.
Legacy’s leadership team toured the Cudahy plant on a Monday at 1 p.m., and by 3 p.m. the same day, they were on the phone with Benford Capital discussing whether purchasing the site made sense for the company.
“We’re constantly looking at and evaluating potential add-on acquisition targets but we’re very selective in our process,” said Patel. “We don’t just jump at any add-on acquisition.”
After taking a short time to pull together a financial thesis and model, Benford Capital’s leadership quickly discovered investing in the Cudahy facility would support its value creation plan.
“We all looked at each other and said, ‘Somebody’s gonna buy it all, somebody’s gonna come in and just take all the equipment,’” said Vallet-Sandre. “Then we kind of started to kick it around and thought, ‘Well, why can’t it be us?”
By 4 p.m. on Tuesday of the same week, Legacy had sent a purchase agreement to T. Marzetti Company. Legacy officially purchased the building on June 27 and was able to begin production there by July 15.
Angelic Bakehouse constructed the Cudahy production facility in 2013, investing $2.3 million in the project. Crediting Angelic’s ownership for careful maintenance of the facility and its equipment, Vallet-Sandre said the space is one of the nicest food manufacturing plants he’s ever seen.
When Angelic Bakehouse ceased operations, 40 employees lost their jobs. Legacy has brought back approximately 20 former Angelic employees to continue working at the Cudahy site, with the expectation of eventually staffing up to 100 people there.
“Those people have been on-site for the last two and a half months learning the equipment,” said Vallet-Sandre. “They had been there before, so they knew it, but learning it as tortilla equipment, as opposed to the flatbreads.”
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Alain Vallet-Sandre[/caption]
"Snacks are one of the fastest-growing categories. That’s what major food companies are focused on.”
The Cudahy facility has room for two more production lines as well as a sizable cold storage space that Legacy is still determining how to use, said Vallet-Sandre, but there is a possibility of expanding into an entirely new product category due to high demand for cold storage.
What’s more, there is also the ability to increase the footprint of the building into a neighboring parcel of land owned by the city of Cudahy.
Patel has signaled that Legacy’s growth period is nowhere near finished. Plans to expand at the company’s Waukesha headquarters, which are still being considered, and the open site next to the Cudahy facility provide additional growth opportunities for the business.
“It’s very attractive to have an open piece of land right next to us, where we have the option to break the wall down and further expand our footprint,” said Patel. “We’d be very open to start having those conversations with the city.”
