Buying virtue: food giants invest in millennial-friendly snack-makers

Credit: KIND Snacks

Demand among millennials for healthy, natural and sustainably sourced foods has led to a flurry of takeover activity by mega-multinationals in the last few months.

While the leading food companies are all making efforts to make their portfolios healthier, by reducing sugar, salt and saturated fats in their products, the inherent dangers of changing the taste of existing blockbuster brands has meant that this is a slow process.

So many have decided to take a short cut to meeting the demands of the increasingly discerning consumer, by buying-in ready-made companies that already tick all the boxes.

Mars has just purchased a minority stake in KIND, a producer of healthy snacks with strong ethical credentials. KIND will continue to operate independently, adhering to its founding principles of using healthy, unprocessed ingredients and supporting its social mission of making the world a kinder place. It will benefit from Mars’ global expertise and distribution systems to enable it to reach a much wider audience. Mars, meanwhile gains a foothold in the halo economy.

Other examples in the last few months include Nestle’s purchase of Sweet Earth, B&G’s acquisition of Back to Nature Foods, ConAgra’s takeover of Angie’s Artisan Treats, Kellogg’s agreement to buy Chicago Bar Company, and the takeover of Mae Terra by Unilever.

The next move could be a real game changer: Nestlé is reported to be eyeing up Hain Celestial – although it is not alone in expressing an interest. The sheer scale of Hain Celestial – with a turnover of $2.85bn – and its activity in numerous sectors, may make this a tough contest.