Mars, the company behind M&M and Snickers, is acquiring the maker of Kind bars, snacks that lack artificial flavors and preservatives, company executives told The New York Times in an interview.
The deal for Kind North America comes three years after Mars, a private giant in the candy industry, took a minority stake in the company. The terms were not officially announced, but people who knew about the deal said Kind was valued at about $ 5 billion.
Kind, founded by Daniel Lubetski in 2005, sells bars with flavors such as cranberry, almond and dark chocolate and emphasizes clean packaging and simple ingredients. The 2009 deal with Starbucks helped him expand into the crowded snack market. It now also offers muesli, cereals and other products.
“We don’t have to worry about getting a return in 2021,” Mr Lubetski said. “We can think of investments that make sense in two, three, five, 10 years.”
Mr Lubetzky said he would continue to participate in the company and retain a stake in Kind. Mr. Lubetzky, a Mexican-American entrepreneur, made social change a key part of the company’s mission. Among his philanthropic endeavors is The Kind Foundation, which earlier this year helped front-line workers provide goods such as food and skin care products as they fight the pandemic.
For Mars, the deal comes as the company plans a future beyond its candy. One of the largest private companies in the country, Mars also owns several brands of pet food, including Iams, Pedigree and Royal Canin. He has also made major investments in the pet care industry, buying veterinary company VCA Inc for $ 7.7 billion and European AniCura, a chain of animal clinics and hospitals, over the past few years.
When Mars bought a minority stake in Kind in 2017, valuing the company at $ 4 billion, he was trying to catch a wildly popular snack brand that offered a healthy alternative to chocolate bars while Kind was attracted to Mars’ international support. Since then, of course, the pandemic has changed how people shop for food and eating and how companies offer new products. Sales at Kind initially jumped when the pandemic began, Mr Lubetzky said, as householders stocked up on snacks such as their bars and the company benefited from a strong online presence.
But snacks are under pressure as corporate cafes, airports and cafes still have little or no business. In addition, it has become more difficult for food companies to introduce new products, as supermarkets limit shelves to those items they know will be popular.
Personal samples, the traditional way to introduce a new product to the market, have become a health risk.
“It is challenging to present new items around the world during Kovid’s year,” said Mr Lubetski. “The species is gaining a lot of power worldwide, but it’s just taking longer than we’d like.”
This background, at least in the short term, reversed trends that seemed to threaten persistent food brands such as General Mills, Kellogg and Campbell Soup, where sales rose during the pandemic. The largest food companies in the United States have struggled for years to compete with innovations driven by newer niche brands that first infiltrated Whole Foods and later infiltrated traditional foods such as Kroger and Costco.
“I strongly believe that destructive brands have a very long future – a little less in 2020 and 2021,” said Mr Lubetzky.
However, Kind’s sales increased from about $ 1 billion at the end of 2017 to about $ 1.5 billion today, Mr Lubetski said. It has expanded from five countries to 35, including China, Germany and France, and the product range has expanded to include frozen items, building on Mars’ technology to create frozen dairy-free bars.
“When we launched this partnership, I said it was built on mutual admiration and a shared vision for growth,” Mars CEO Grant Reid said in a statement. “In three years, you can see the impact, because together we have grown into the category of healthy snacks.”