Hershey, Campbell Soup chow down on snack deals
Two big food companies got their own cases of the munchies Monday, announcing separate deals to scarf up snack makers and move in the direction of healthier between-meal eating. Hershey, best known for its candy bars, is buying Amplify Snack Brands, best known for its Skinny Pop popcorn, for more than $920 million. Amplify also has Paqui tortilla chips and Oatmega whey protein bars and cookies. And Campbell Soup will acquire Snyder’s-Lance, best known for Kettle potato chips, Snyder’s of Hanover pretzels and Pop Secret popcorn, for $4.9 billion. It also has healthy brands such as Emerald nuts and EatSmart for natural foods. The one-two-punch of food news enables two gigantic companies, not known for their nutritious offerings, to gain stronger footholds in the ever-growing healthy snacking segment — known in the industry as Better for You, or BFY. Individual snacking — single-serving items such as candy, chips, yogurt, cut-up fruit, nuts and granola bars — is a $33 billion industry in the U.S., according to consumer data company Nielsen. In the last year, 98% of all American households bought at least one of the various snack items. The Hershey deal is a way for the company most associated with chocolate to become an “innovative snacking powerhouse ... to delight consumers with other products to meet their needs,” says CEO Michele Buck, who assumed the top job in March. “We captured the Amplified brands at the right moment. Consumers are snacking more and more. It’s no surprise that many companies have an interest in snacking.” This isn’t Hershey’s first time branching out. In 2015, it bought jerky maker Krave Pure Foods. Last year, it gobbled up Ripple Brand Collective, which produces barkTHINS. Soup icon Campbell is no stranger to snacking. It owns Pepperidge Farms, known for its packaged cookies, and Kelsen Group, which makes Royal Dansk cookies. But this time, both Hershey and Campbell are swiveling toward smacks perceived to be more healthy because that’s where they are more likely to find growth. Nielsen found snack foods that emphasize their healthfulness are bounding ahead faster than the regular ones. Those that tout they are made from non-genetically modified ingredients saw 18.2% growth in sales for each of the past five years. Snacks billed as being made without artificial flavors and coloring experienced a 16.2% jump. Sugar-free or reduced-sugar snacks had an 11.3% increase. Yet annual household spending on general snacks grew only 1.2%. “It’s a transformational acquisition. This acquisition will pivot the company forward from soups to snacking to a much more dynamic area,” said Luca Mignini, president of Campbell’s global biscuits and snacks. Both Hershey and Campbell said the deals won’t affect pricing. Experts say the difference consumers will experience is in where and how the products are sold. Campbell, a center-of-the-store giant in the supermarkets, could demand more of a presence for Snyder’s-Lance products and Hershey’s may expand Skinny Pop from grocery stores into big-box retailers and, with an emphasis on single-serving packs, convenience stores. Last month, candy manufacturer Mars invested in healthy-snack maker Kind. In October, Kellogg announced it was acquiring RXBar.