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Smucker buying Nutrish pet food for $1.9 billion

Following recent Blue Buffalo deal, acquisition shows confidence in pet food market

Michael Browne, Executive Editor

April 5, 2018

2 Min Read
Smucker buying Nutrish pet food for $1.9 billion
courtesy of Nutrish

The J.M. Smucker Co. will pay $1.9 billion to purchase Ainsworth Pet Nutrition, a premium pet food company known for its Nutrish brand pitched by Rachael Ray. Smucker is also said to be considering selling its baking division, led by the Pillsbury brand. 

The acquisition comes on the heels of General Mills’ purchase of Blue Buffalo Pet Products in February for $8 billion, indicating both companies’ high expectations for the growth of the “wholesome” pet food category. "Wholesome" products make up 10% of the pet food market and are gaining market share.

"Ainsworth Pet Nutrition is an excellent strategic fit for our company, as the Rachael Ray Nutrish brand adds another high-growth, on-trend brand to our pet food portfolio," J.M. Smucker CEO Mark Smucker said in a statement. "Their team has done a tremendous job growing this business, building Nutrish into one of the most recognizable premium pet food brands in the United States."

Nutrish holds a leading position and is one of the fastest-growing brands in the premium dry dog food segment within the grocery and mass channels, a key growth driver for the overall category.  The addition of Nutrish to the Smucker portfolio will significantly expand the company's presence in this area, complementing its Nature's Recipe brand.

Pet food/snacks has become the largest center-store category in the U.S. food and beverage market, according to Smucker, generating over $30 billion in annual retail sales across all channels, and remains one of the fastest-growing categories. The company said that the “acquisition and the addition of the high-growth Nutrish brand will increase the scale and further accelerate the growth profile of its pet food business.”

Akshay Jagdale, equity analyst at Jefferies, notes that while Nutrish is primarily sold in grocery stores, “there seems to be a big opportunity to expand into the Specialty channel (the Nutrish brand recently announced expansion into PetSmart) and e-commerce, which are channels where Smucker’s (SJM’s) pet food business is more established. Furthermore, SJM believes the Nutrish brand can extend into the Cat and Pet Snacks category, where its current presence is negligible. The Nutrish brand has strong credentials and is complementary to SJM’s current portfolio of pet brands, making SJM a sizable player in the premium dog food category in the Mass channel, where the company under-indexed previously. The obvious benefit that SJM brings is scale.”

In addition to its purchase of Ainsworth, Smucker announced it is exploring strategic options for its U.S. baking business, including a potential sale. The review encompasses products sold in U.S. retail channels under the Pillsbury, Martha White, Hungry Jack, White Lily and Jim Dandy brands, along with all relevant trademarks and licensing agreements. 

About the Author

Michael Browne

Executive Editor, Supermarket News

Michael Browne joined Supermarket News in 2018 after serving in managing and executive editor capacities at leading B2B media brands including Convenience Store NewsLicense Global and Travel Agent. He also previously served as content production manager for print and digital in the Business Intelligence division of Informa, parent company of Supermarket News and Nation’s Restaurant News.

As executive editor, Mike oversees the editorial content of supermarketnews.com as well as the monthly print publication. He also directs all content-based brand-related projects including the annual Top 75 Retailers report, Category Guide, Retailer of the Year, research surveys and special reports, as well as podcast and webinar content. Mike has also presented and moderated at industry events.

In addition to the positions mentioned above, Mike has also worked as a writer and/or editor for special projects at American Legal Media (ALM), managing editor for Tobacco International, special projects editor at American Banker • Bond Buyer, and as production editor for Bank Technology News and other related financial magazines and journals published by Faulkner & Gray.

A graduate of Fordham University, Mike is based in New York City, where he was born and raised.

Contact Mike at [email protected] or follow him on Twitter and LinkedIn.

 

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