5 recent deals that show Big Food is hungry for natural
![5 recent deals that show Big Food is hungry for natural 5 recent deals that show Big Food is hungry for natural](https://eu-images.contentstack.com/v3/assets/blt09e5e63517a16184/bltc54750182a6fa01e/64f1d8645d2bd237d7862e99/ConAgra_1_1.jpg?width=700&auto=webp&quality=80&disable=upscale)
Conagra
$4 billion. That’s how much major packaged food companies lost in market share last year, according to a recent report in Fortune. Growing public distrust in the food system and consumer demand for more authentic foods with simpler ingredients is leading restaurants and food companies to take a closer look at their ingredients and practices. Others are buying smaller companies or expanding their product lines to earn shelf space specifically in natural food stores and aisles. So far this year, at least five deals that demonstrate this trend have been announced. A common theme among almost all of them is a structure that allows the smaller (presumably more trusted) company to remain a standalone operation. Has Big Food learned from the struggles of Kashi and Kellogg's? And are natural brands selling up or selling out?
“As I looked to sell the company, the most important thing for me was finding a partner that would let Applegate keep being Applegate,” Founder Stephen McDonnell said in a statement, acknowledging that the company behind Spam may not seem to be the most likely partner for the maker of humanely raised and organic meats. “I believe that Hormel Foods is buying us because they believe we are doing something right.” The $775 million deal will allow Applegate to scale up its business by giving it access to more resources and distribution channels, even while it remains a standalone subsidiary. McDonnell said the acquisition will not change Applegate's position on important issues like GMO labeling or antibiotics. “I don’t ask you to take me at my word. Just watch what we do,” he said.
Struggling with slowing sales and increasing costs, ConAgra ventured into the growing natural and organic frozen food category when it acquired Blake’s All Natural Foods earlier this month. Blake’s, which offers healthier and special-diet-friendly items including gluten-free pot pies and macaroni and cheese, joins a family of decidedly less-healthy brands including Banquet, Healthy Choice and Chef Boyardee.
Mondelez International has seen a slowdown in some of its product categories and has struggled to consistently impress investors with top-line results since its 2012 split from Kraft Foods Group. Its most recent acquisition is better-for-you snack maker Enjoy Life Foods. A trusted brand among families dealing with food allergies, Enjoy Life risked big consumer backlash when it made a deal with Mondelez, the parent company of Oreos and Chips Ahoy. When the news was announced in February, Enjoy Life's senior leaders posted their phone numbers and email addresses on the company’s website, saying they welcomed all questions and concerns from consumers.
Hershey’s appetite for new, on-trend snacks led it to Krave, which did $36 million in beef jerky sales in 2014, according to the New York Times. Unlike many convenience store jerky brands, Krave’s artisanal jerkies lack nitrates and artificial ingredients, instead using real ingredients and flavors like fruit juices and honey. The deal, which was finalized earlier this year, gives Hershey an in on the better-for-you snacks and protein trends.
Despite the earthy branding of Mom's Best cereals, they still contain more than a little sugar and not a whole lot of nutrition. But the fact that they're free of artificial flavors, preservatives, hydrogenated oils and high fructose corn syrup is a step up from the Fruity Pebbles and Golden Crisps of the world. And combined with Post's acquisitions of better-for-you cereal makers Hearthside Foods and Attune Foods in 2013, this move could give Post more leverage with health-conscious moms in the cereal aisles of natural food stores.
Despite the earthy branding of Mom's Best cereals, they still contain more than a little sugar and not a whole lot of nutrition. But the fact that they're free of artificial flavors, preservatives, hydrogenated oils and high fructose corn syrup is a step up from the Fruity Pebbles and Golden Crisps of the world. And combined with Post's acquisitions of better-for-you cereal makers Hearthside Foods and Attune Foods in 2013, this move could give Post more leverage with health-conscious moms in the cereal aisles of natural food stores.
5 recent deals that show Big Food is hungry for natural
About the Author(s)
You May Also Like