Unilever has expanded its footprint in the healthy snacks market by acquiring London-based brand Graze for an undisclosed sum.
Graze has been offering a range of snacking nuts, seeds, trail mixes and snack bars, made without artificial ingredients, since 2008.
The brand was previously owned by global investment firm Carlyle. During Carlyle’s ownership, it experienced strong growth in its delivery service, as well as expansion into retail stores in the U.K. and U.S., with products being stocked in retailers, including Sainsbury’s, Boots, Costco and Target.
Managing director on the Carlyle Europe Technology Partners advisory team, Fernando Chueca, said: “It has been a delight to support Graze with its international expansion, and development into the largest multi-channel brand in the health snacking sector.”
Upon the acquisition, Graze will be operated with limited integration, according to a Unilever’s spokesperson.
“Accelerating our presence in healthy foods and out-of-home [sectors], this is an excellent strategic fit for the Unilever’s food and refreshment business, and a wonderful addition to our stable of purpose-driven brands,” said Nitin Paranjpe, president of Unilever’s food and refreshment business.
“We look forward to working with the Graze team to grow the business, leveraging their tech and e-commerce expertise for our wider portfolio, and offering more consumers the opportunity to snack in a healthier way.”
|Sainsbury (J) plc|
|Walgreens Boots Alliance Inc|
|Costco Wholesale Corp|
|Coca Cola Company (The)|
Market closed | Prices delayed by at least 15 minutes
Switch to live prices |
He noted that Graze is currently the number one healthy snacking brand in the U.K., and it meets the needs of millennial consumers through personalization, convenience, and nutrition.
“This deal marks a transformational moment in Graze’s growth journey,” the company’s CEO Anthony Fletcher said in a statement, adding the team will keep “inventing new healthy snacks, as well as continuing to work to understand the role technology can play in improve the food industry.”
Moving forward, Graze’s executives also hope that learning from Unilever’s sustainable living plan will become a key driver for their business.
The sustainable living plan includes three main targets: Improving health and well-being for more than one billion people by 2020; reducing environmental footprint by half by 2030; and enhancing the livelihoods of millions of people by 2020, according to Unilever’s website.
As part of the plan, Unilever participated in the Ellen MacArthur Foundation’s new plastic economy initiative alongside Mars, Coca-Cola and PepsiCo in 2017, and vowed to use 100% reusable, recyclable and compostable packaging by 2025 at the latest.
Graze and Unilever did not make further comments on the deal.
Heath and wellness snacks’ growth
Unilever’s acquisition of Graze underlines the rapid growth of the overall health and wellness foods market in the U.K.
According to Euromonitor, free-from products saw especially strong growth in current value terms in 2017 with growing awareness about food allergies, while demand also extended to those looking to restrict their intake of gluten and lactose as a lifestyle.
Meanwhile, growing interest and concern over the source of the food that is consumed has helped to support the growth of organic and naturally healthy beverages and packaged food, the market research firm added.
“This increased interest and demand in health and wellness packaged food and beverages have been met with the entry of new products to the market not just from specialists, but also large international manufacturers, which are increasingly recognizing that this is an industry with a bright future ahead of it,” said Euromonitor.
In 2016, Mars Wrigley introduced a line of trail mixes under its iconic confectionery brand M&M’s in the U.K., as the domestic fruit and nut snacking market was dominated by own-label products at that time, and there were few premium brands.
Trail mix, as a standalone category, was also relatively new to the British consumers, although it has been on trend in the U.S.
In recent years, “only a handful of snacks called ‘trail mix’ have been launched in the U.K., and these new entries may be a way of introducing British consumers to the concept of a snack that combines sweet and salty bites in one bag,” Mintel’s food and drink analyst Marcia Mogelonsky previously noted.
The growing consumer awareness of the benefits of vitamins, minerals, and good fats are also boosting the health and wellness snacks’ growth in the U.K.
Euromonitor data shows the country’s healthy snacks category grew from $873.3 million in revenue in 2013 to $1.13 billion in 2018, with a CAGR of 5.3% and a period growth rate of 29.2%.
This article was written by Douglas Yu from Forbes and was legally licensed through the NewsCred publisher network. Please direct all licensing questions to firstname.lastname@example.org.
Free Newsroom email alerts
Register for daily/weekly email alerts with news from The Financial Times, Forbes, Reuters, The Economist and more.