Vegan milk brand Oatly is facing protests from political and climate activists who say the decision to sell a stake in the company to a consortium that includes Blackstone, a powerful private equity firm headed by Trump donor Stephen Schwartzman, has left a bitter taste.
The $200 million deal for the Swedish oat milk brand, favored by many vegans and non-dairy drinkers and considered one of the most sustainable plant-based milk brands, was agreed in July.
But now the deal, which valued Oatly at nearly $2 billion and involved investors including Oprah Winfrey, Natalie Portman, former Starbucks boss Howard Schultz and the entertainment company founded by Jay-Z, is under scrutiny.
TO Twitter thread surfaced over the weekend that linked Blackstone to a controversial Brazilian infrastructure investment that has been accused of contributing to deforestation in the Amazon.
Blackstone has been the target of investments in Hidrovias, a Brazilian infrastructure company, which has previously been accused of links to deforestation in the Amazon rainforest.
Blackstone has denied the allegation, saying in a statement: “The misstatements and mischaracterizations were blatantly incorrect and irresponsible.”
On Tuesday, the company reiterated its position that Hidrovias was not involved in a road through the Amazon jungle used to transport soybeans grown on illegally deforested land and had won awards for its sustainability efforts.
“Hidrovias does not own, control or have any interest, direct or indirect, in the highway in question (BR-163). This road has been operated by the Brazilian government since 1976. The company did not build this road nor is it paving it,” Blackstone said.
Despite that accusation, Blackstone’s Schwartzman has been a prominent supporter of Donald Trump on Wall Street. According to Bloomberg, the billionaire investor has donated $3 million to Super Pac America First Nation, which supports the re-election of the president.
Oatly has now placed himself in a position to defend the deal. In a sentence posted on Twitter, the company said Blackstone may be an “unexpected choice” but the investment “will help us expand our sustainable mission and create more plant-based products.”
The company added: “It also directs capital that would otherwise have gone into other business investment towards sustainability, making its investments greener.”
But that has yet to appease the critics. The original Twitter threadThe creator of , activist Laura Young, wrote: “I don’t want my money going to destroy the planet and put people’s lives and earth at risk just so I can have creamy coffee in the morning!”
Oatly responded to that thread, offering: “We’re sorry to hear you’re frustrated with our choice – we’re still the same company with sustainability at the core of everything we do. This includes who we choose as owners, as we need to move global capital in a sustainable direction if we want to see real change.”
The company added: “If we simply weed out companies that can make less sustainable decisions, we won’t give them the opportunity to improve and make more sustainable decisions, so global capital will continue to be steered in a less sustainable direction.”
When signed, the agreement underscored the growing popularity of plant-based foods. Oat milk’s popularity is rising: US store sales grew nearly 300% year-over-year through June, according to Nielsen data.
Founded in the 1990s by brothers Rickard and Björn Öste, Oatly entered the US market four years ago. Sales last year doubled from 2018 to around $200 million. It expects similar growth this year, according to reports, and plans to use the investment to more widely distribute its oat-based yogurt, spreads, to-go drinks and ice cream.