Highlander Partners has acquired Tapatío, the No. 5 hot sauce brand in the U.S., buying the business from the Saavedra family in a deal that brings in additional equity and new financing partners while keeping the founding family involved post-closing.
The Dallas-based private investment firm said The Arnold Companies invested alongside Highlander in a significant minority equity position, and the Saavedra family will retain a minority stake following the transaction. Financial terms were not disclosed.
Founded in California in 1971 by Jose-Luis Saavedra Sr., Tapatío is positioned as an authentic, Mexican-inspired hot sauce brand with broad appeal among both mainstream and Hispanic consumers. The brand name refers to a term for someone from Guadalajara, Mexico, reflecting the company’s ties to traditional Mexican flavors. The product is best known for a medium-heat profile built on red peppers, vinegar, garlic, and spices.
Highlander framed the acquisition as a platform for geographic expansion and product innovation, citing growth opportunities outside Tapatío’s core stronghold in the Western U.S. The firm said it plans to broaden distribution, deepen penetration across retail and foodservice channels, and pursue new product development and adjacent categories.
Highlander Partners said it manages more than $3 billion in assets and typically employs a buy-and-build strategy, combining organic growth with acquisitions.
Support: In the Tapatío deal, Stout served as exclusive financial advisor to Tapatío. J.P. Morgan led the senior financing facilities, while NMP Capital provided financing and equity support. Katten served as legal advisor to Highlander.
KEY QUOTES:
“We are excited to partner with Tapatio, a generational business that is distinguished by a strong, authentic brand in the fast growing hot sauce category. We believe that Tapatio is poised to benefit from several secular trends that are dramatically reshaping consumer food choices, and we look to take advantage of the brand’s significant whitespace opportunity.”
Jeff L. Hull, President and CEO, Highlander Partners
“It is both a privilege and an immense responsibility for Highlander to be the next steward of the Tapatio brand. We share the Saavedra family’s vision to maintain the brand’s legacy as we carefully and purposefully target opportunities to grow the brand geographically, introduce new flavors and products, and deepen penetration in both the retail and foodservice channels.”
Jeff Partridge, Partner, Highlander Partners
“Highlander is a perfect fit given their extensive background in the branded Hispanic food category, and we are pleased to have a partner that invests their own capital and takes a long-term strategic approach to growing companies. Tapatio has a strong business with a proud heritage and identity. Highlander shares our vision to maintain this legacy.”
Luis Saavedra Jr., Former CEO, Tapatío
