B&G Foods Goes Back to Nature -- WSJ
August 21 2017 - 3:03AM
Dow Jones News
By Annie Gasparro
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (August 21, 2017).
B&G Foods Inc. has struck a deal to buy SnackWell's cookies
and Back to Nature granola for $162.5 million, adding to its stable
of older brands that have faltered as eating habits change.
Chief Executive Bob Cantwell said acquiring SnackWell's low-fat
products and Back to Nature's bars from a joint venture between
Oreo maker Mondelez International Inc. and private-equity firm
Brynwood Partners will give B&G more leverage with
natural-foods retailers.
"We'll have a bigger place at the table to talk to Whole Foods
and Sprouts," he said. "Hopefully we'll add more brands like this
under that platform."
B&G has developed a taste for longstanding brands like Cream
of Wheat and Green Giant frozen vegetables that Mr. Cantwell said
had been neglected by the big food companies that have long owned
them. Lagging sales have pushed Nestlé SA, General Mills Inc. and
other conglomerates to shed laggard brands in recent years and
focus on their most popular products.
Nabisco created Snackwells in 1992 at a time of high demand for
low-fat products. At its peak the brand's Devil's Food Cookie Cakes
and other treats generated more than $500 million in annual sales,
but their popularity has waned as consumers shifted to
low-carbohydrate and low-sugar diets.
About five years ago, Mondelez sold controlling interests in
SnackWell's and Back to Nature to Brynwood Partners and tasked the
private-equity firm with reviving SnackWell's and expanding the
Back to Nature brand. Sales of Snackwell's products have continued
to struggle, but Brynwood had more success boosting Back to Nature
by introducing new products and getting them into more stores.
Today SnackWell's and Back to Nature generate about $80 million in
annual sales.
Brynwood Chief Executive Henk Hartong said smaller brands that
are part of a bigger conglomerate can benefit from the attention a
smaller company can bring. B&G's sales were about $1.4 billion
last year, compared with Mondelez's $26 billion.
"What it's starving for and what it needs to be successful, it
can't get from a giant company that is trying to manage so many
brands," he said of a smaller brand.
Write to Annie Gasparro at annie.gasparro@wsj.com
(END) Dow Jones Newswires
August 21, 2017 02:48 ET (06:48 GMT)
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