Dive Brief:
- B&G Foods said Thursday the company is selling its Back to Nature brand to Barilla America. The company did not disclose the price.
- Casey Keller, B&G’s CEO, said in a statement that the sale is part of the company’s efforts to focus on businesses core its long-term strategy and reduce long-term debt. The sale is expected to close in the first quarter of 2023.
- Keller told analysts last month that B&G Foods was actively seeking to sell Back to Nature, and had initiated a strategic review to identify other potential divestitures.
Dive Insight:
For a company built on acquisitions, B&G’s sale of Back to Nature marks a change. While it has not shied away from a deal when the timing or price is right — it sold Pirate Brands, the maker of Pirate’s Booty and other better-for-you snacks to Hershey for $420 million in 2018 — a sale is highly unusual for the New Jersey company.
The conglomerate, which owns a collection of brands including Cream of Wheat, Crisco and Green Giant, has hinted recently that a pruning of its portfolio was imminent. The sale of Back to Nature, a maker of cookies, crackers, granola, nuts and trail mix, is likely just the beginning.
CFO Bruce Wacha told analysts B&G was in the process of reviewing its portfolio to ensure its brands fit with the strategy the company has laid out for each of its four business divisions. In June, B&G created these units — specialty, frozen and vegetables, meals, and spices and seasonings — to improve focus and drive growth.
The ongoing review, Wacha said, will both influence the brands the company wants to divest and determine those it wants to buy going forward, he said last month.
B&G purchased Back To Nature and SnackWell’s snacks for $162.5 million from Mondelēz and Brynwood Partners five years ago. At the time, B&G was building a snacking portfolio, but it has since prioritized other areas for growth. While B&G has not publicly shared what other brands it might divest, products that don’t fit with the rest of its business, such as fabric spray Static Guard, are prime candidates.
For its part, Barilla says it has been working to build a multi-brand bakery platform in the United States. The brand, which is best known in the U.S. for pasta, also owns the Wasa crispbread brand. Barilla has a more extensive portfolio of baked goods in Europe, including cereal, cakes, cookies and bread brands.
“This operation reminds me of when we first started our journey with pasta over 25 years ago and we are now the market leader. The acquisition of Back to Nature is a key step for this exciting journey,” Barilla Group Chairman Guido Barilla said in a written statement. “We focus all our business activities and products on health and indulgence and hence Back to Nature was a natural choice.”
