(Reuters) - U.S. meal kit company Home Chef is exploring options including a potential sale, people familiar with the matter said, as its biggest competitor, Blue Apron Holdings Inc (APRN.N), prepares to go public and Amazon.com Inc (AMZN.O) circles its turf.
Home Chef could fetch more than $600 million based on expected 2017 revenue of more than $300 million, the sources said on Thursday. Such an outcome would show that Amazon's $13.7 billion deal this month to buy Whole Foods Market Inc (WFM.O) is not perceived as a major threat to companies such as Home Chef.
Home Chef is working with Deutsche Bank AG (DBKGn.DE) to review its options, the sources said. While a sale of the company is the most likely path, Home Chef is also open to receiving a minority investment, the sources added.
Home Chef has been approached by grocery store companies and consumer packaged goods companies looking to acquire it or invest in a minority stake, according to the sources.
The sources asked not to be identified because the deliberations are confidential. Home Chef could not be reached for comment. Deutsche Bank declined to comment.
Meal kit delivery companies, which operate on a subscription service to deliver ingredients and recipes that allow customers to easily prepare meals, have grown in popularity in the last few years.
With its initial public offering next week, Blue Apron is seeking to convince stock market investors that its business forms the basis of a sustainable industry and is not just a fad.
HelloFresh, Chefs Plate and Chef'd are among other meal kit delivery companies. The increasingly crowded industry has already seen some casualties. Startups Sprig and Maple shut down this year after struggling to cover their costs.
Home Chef, founded in 2013 in Chicago by Pat Vihtelic, seeks to stand out from the pack by offering family-friendly food and recipes that are straightforward to prepare. The approach has helped the company retain customers and avoid high customer churn, making it profitable.
Blue Apron, on the other hand, posted a net loss of $54.9 million last year, driven by spending on logistics and marketing, even as its revenue more than doubled to $795.4 million.
Several consumer packaged goods companies have shown an interest in meal kit companies in recent months. Unilever Plc's (ULVR.L) venture arm led a $9.2 million fundraising round into organic-focused Sun Basket last month.
Consumer-focused private equity firm L Catterton invested $40 million in Home Chef last year.
Reporting by Liana B. Baker in San Francisco and Lauren Hirsch in New York; Editing by Leslie Adler