The rumored Campbell Soup sale to Kraft Heinz has sparked debate among industry analysts on whether or not it would be a smart move for both CPG players. Taking a closer look at the potential deal some benefits for both companies start to emerge.
According to Carolina Alfero, research analyst at Euromonitor, the deal could be beneficial for both parties if Kraft Heinz is going after Campbell for its snack portfolio rather than its canned soup business.
Slumping sales of canned soup have weighed heavily on Campbell’s performance with declining sales of 7% in Q1 2018, falling from 35% of its overall business to 27%.
“In my opinion, if they are aware that the biggest opportunity is in the snack category as opposed to shelf-stable soups I would agree that this acquisition could make sense for Kraft Heinz,” Alfero told FoodNavigator-USA.
While the Campbell’s soup can imagery is strongly intertwined in its branding, the food company has a solid position in the better-for-you snacking category with its acquisition of Snyder’s Lance for $6.1bn and its ownership of Pepperidge Farm.
After the Snyder’s Lance acquisition, Campbell’s snack and biscuits product portfolio grew 50% and currently represents more than 45% of its net sales, Alfero added.
“This makes the case that Campbell Soup is moving away from the soup market and getting stronger in the snack sector. As a result, acquiring Campbell would place Kraft Heinz in a better position in the strongly performing snack market in the US,” she said.
— Leer en www.foodnavigator-usa.com/Article/2018/07/13/Kraft-Heinz-Campbell-merger-could-make-sense-if-deal-is-snack-focused-but-timing-may-not-be-right-says-analyst