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FIRST DELAWARE BENEFIT CORPORATIONS

B Lab has posted a list of companies that either converting or incorporated as benefit corporations under Delaware law today (the first effective day of the benefit corporation statute). The list of those companies is below but I’d like to highlight two significant ones here given their size and recent/ongoing acquisitions:

— Method — As in the green cleaning products found in Target. In 2012, Method became a subsidiary of Ecover Belgium NV, another global green cleaning product company.

— Plum Organics — The ubiquitous baby food line. Plum Organics is the #4 baby food company in the U.S. with $93m in sales in 2012. In May 2013, Campbell Soup announced that it was buying Plum Organics and would keep it as a distinct brand. I don’t have any updates as to whether that acquisition is still in process but as of May 2013 the deal was expected to close in the 4th quarter.

Having written about the flexible purpose corporation (a California stakeholder corporate form) being a viable way to safeguarding a company’s social mission in the mergers and acquisitions context (paper here) (Professor Haskell Murray similarly wrote about the benefit corporation in the M&A context – paper here), I am very curious as to how converting to a Delaware benefit corporation impacted or was a result of these two acquisitions. Did the companies always intend to convert in order to maintain their green missions? Was this negotiated as a part of the acquisition deal?

Another stand out amongst the Delaware benefit corporation crowd is RSF Capital Management, a subsidiary of RSF Social Finance — a major impact investor, social enterprise lender, and donor.

The other companies that incorporated or converted to the Delaware benefit corporate form are:

ALTER ECO

American Prison Data Systems

Better Than We Found It

Exemplar Companies

Fair Parenting Project

Farmigo

Grassroots Capital Management

Ian Martin Group

Imani Energy

New Leaf Paper

Plexx

Profile Health Systems

Roozt

Socratic Labs

Venture Pilot

Comments (5)

  1. […] the undisputed heavy-weight champion of American corporate law, recently passed the “Public Benefit Corporation.”  What’s interesting about the Delaware statute is that it has many more flexibility […]

  2. Lara Phimister

    September 15, 2013 at 11:48 pm

    ALicia,
    Do you know if Plum Organics followed through with their reincorp in Delaware? I can’t find them in an entity search on the DE Sec of State website and all references about reincorporating as a public benefit corp have been removed from their website (e.g., go to their site map and click on bcorp. The link is gone and all references to the story in their press section have broken links.) It would be interesting to know if the Campbell acquisition prevented or complicated their clear intentions. Any idea?

  3. Alicia Plerhoples

    September 16, 2013 at 8:59 am

    Lara – That’s interesting. I’m not sure. The most recent article I’ve seen on the acquisition said that Plum Organics is a public benefit corporation and a fully-owned subsidiary of Campbell Soup. Here’s the article: http://www.csrwire.com/blog/posts/1005-campbell-becomes-america-s-first-public-company-to-acquire-a-public-benefit-corporation-in-conversation-with-plum-organics-cofounder?utm_medium=Twitter&utm_campaign=CSR+and+sustainability+news.

  4. Freeman White

    June 4, 2014 at 2:13 am

    Thanks for the article. Regarding the acquisitions, I believe that both of those companies were only Certified B Corps by B Lab, not actually incorporated from the get go or converted into legal Benefit Corporations. The CSRWIRE release and others seem to be intentionally or mistakenly confusing on this point. Can either of the other commenters here confirm if Method or Plum were actually incorporated as Benefit Corporations or just certified by B Labs?

  5. Alicia Plerhoples

    June 4, 2014 at 10:17 am

    Yes, I can confirm that Method and Plum are actual public benefit corporations and not just certified by B-corps. I have their certificates of incorporation. And you can check the Delaware corporations website here to search for them and see that they are indeed public benefit corporations: https://delecorp.delaware.gov/tin/GINameSearch.jsp. Plum is actually “Plum, PBC” and Method is “Method Products, PBC.”

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