Vegetarian meals deal to freshen Nestlé image
Food giant buying Sweet Earth startup to grow in key area
GENEVA — The maker of Hot Pockets wants to go vegetarian, California-style.
Nestlé, the world’s biggest food and drinks company, is buying husband-and-wife startup Sweet Earth, which sells frozen burritos stuffed with quinoa, beans and other vegetarian ingredients.
The move echoes efforts by food conglomerates across the world that have been trying to appeal to consumers who favour fresher foods, smaller, local brands and are worried about ingredients.
Nestlé, whose frozen food brands include Lean Cuisine and Stouffer’s, recently invested in online meals company Freshly, which delivers cooked meals to customer’s doorsteps that it says are glutenfree and don’t contain refined sugars. In 2012, Campbell Soup bought natural foods maker Bolthouse Farms. And on Thursday, rival Unilever said it was buying Pukka Herbs, a small but fast-growing organic herbal tea business.
“This segment has been identified for us globally as a key area a few years ago,” said Wayne England, head of strategic food operations at Nestlé. “Giving the world better access to vegetarian-based or plant-based food is something we want to do.”
Nestlé, which is based in Vevey, Switzerland, said Sweet Earth, which reportedly had $25 million in revenue last year, will remain a standalone business, and stay at its headquarters in Moss Landing, Calif. It declined to specify the cost of the deal.
Sweet Earth co-founder Kelly Swette, who will continue to run the company with co-founder and husband Brian, said in an interview: “We believe in redefining frozen food.”
She said several companies approached Sweet Earth about a buyout, but declined to name them. The deal with Nestlé, she said, will help get Sweet Earth into more frozen food aisles. It’s currently in more than 10,000 stores, including Walmart and Whole Foods.
At its core, the deal is about Nestle’s need to constantly adapt to changing consumer tastes, particularly among health- and “authenticity”-minded consumers like many Millennials these days.
Such consumers “look for more transparency, more natural, more ingredients they understand, that can relate to their own kitchens,” England said. “We have a drive to find the trend of authenticity in every one of our products.”