New Water Capital Acquires Leading Baked Goods Manufacturer Klosterman Baking Company

BOCA RATON, Fla. — An affiliate of New Water Capital Partners II L.P. (New Water), a Boca Raton-based private equity investment firm focused on lower-middle market companies, has acquired Cincinnati, Ohio-based Klosterman Baking Company Inc. (Klosterman).

Founded in 1892 by members of the Klosterman family, Klosterman is a leading producer of fresh and frozen breads, buns, flatbreads, organic breads, artisan breads, donuts and other bakery products serving an extensive, well established national customer base of restaurants and other foodservice operators, grocery retailers and convenience stores, and institutional customers. Today the Company operates 17 bakeries and distribution facilities across the eight Midwest states.

“Klosterman’s leading position as a producer and distributor of fresh and frozen bakery items to major grocer, restaurant and institutional customers offers a recession-resistant investment opportunity with excellent long-term growth potential,” said New Water Principal Anuj Singh.

“Over the course of four generations, the Klosterman family has built a remarkable business that has a reputation for putting customers and employees first,” Singh said. “We are grateful to be able to partner with the company to continue building upon that culture and legacy. With the ever-growing demand for consumer convenience, the expansion of the fast food and quick-serve restaurant sector, and the recent, inflation-driven appetite for home-served meals, Klosterman is well positioned to withstand and benefit from a fluctuating economic and consumer environment.”

“New Water has a proven record of success in recognizing and building on the strengths of their partner companies to help them reach the next level of growth and success,” said Chip Klosterman, representing the selling Klosterman family. “Their respect for the positive company culture Klosterman has nurtured over the past 130 years made them the preferred partner to take our company into the future.”

“Through our partnership with management, Klosterman will look to expand the company’s product portfolio and geographic distribution footprint to better serve our growing customer base through a combination of organic and inorganic growth levers,” added New Water Vice President Nick LaRosa.

“New Water’s capital investment and management experience in the food sector will give Klosterman the tools it needs to scale to meet existing customer demand and to optimize its market position nationally,” said Klosterman President Ross Anderson.

“New Water brings leadership and strategic expertise we will be able to utilize to better systemize operations, enhance our distribution channels and position ourselves for further growth,” Anderson said. “We are excited about the enormous potential for Klosterman Baking Company under this new partnership.”

The acquisition of Klosterman adds to New Water’s presence in the manufactured foods sector, which includes frozen foods developer The Perfect Bite Co. and frozen foods manufacturer Pegasus Foods. New Water previously held fresh foods provider Custom Made Meals (CMM), which it acquired in 2017 and sold in May 2021, after expanding CMM’s U.S. customer base from approximately 6,000 grocery retail locations to more than 15,000 retailer locations nationwide.

Lincoln International LLC served as the exclusive financial advisor to Klosterman and the sellers.

About New Water Capital L.P.

New Water Capital L.P. is a private equity firm focused on lower-middle market companies in the consumer products and industrial manufacturing and services sectors with revenues of $30 million to $300 million. New Water Capital’s collaborative transaction and operating model is built specifically to support companies in transition, building on their unique cultures and strengths. For more information, please visit