Iams, Eukanuba acquired by Spectrum Brands

Spectrum Brands Holdings Inc., a global and diversified consumer products company with market-leading brands, has completed the acquisition of Procter & Gamble’s European pet food business, consisting of the complementary Iams and Eukanuba premium brands for dogs and cats. Financial terms of the accretive transaction were not disclosed. A definitive agreement was announced on September 23.
“The addition of these leading brands in an adjacent category better balances the product portfolio of our global pet business while significantly expanding its product offerings and geographic footprint,” said Dave Lumley, CEO of Spectrum Brands Holdings.
“We see major cross-selling opportunities given the strength of our existing aquatics and companion animal supplies business in continental Europe and the particularly strong position of these dry pet food brands in the UK,” Lumley said. “Over the next few years, we also expect important synergies in overhead, SG&A, and manufacturing and distribution.”
The Iams and Eukanuba European pet food business has annual sales of approximately $200 million. The total European dog and cat food market is estimated to be $21 billion annually and growing at 3 to 5 percent per year.
“I view the Iams and Eukanuba brands as iconic in the specialty pet food category,” said David Maura, chairman of the board of Spectrum Brands Holdings. “With this acquisition, we are strategically strengthening our companion animal product portfolio and investing behind our global pet supplies business. We expect this deal to be accretive in year one, but more meaningfully so in the second year, once fully integrated. We welcome the P&G employees to the Spectrum Brands family and look forward to driving this business to an even higher performance level and providing outstanding service to our customers.”

Mars acquires P&G petfood business in Australia, New Zealand

Mars Incorporated has completed its acquisition of the Iams and Eukanuba pet brands from The Procter & Gamble Company in Australia and New Zealand. This follows an agreement announced by the companies earlier in 2014 and receipt of all necessary regulatory approvals. Mars has already acquired Procter & Gamble's petfood business in North America, Latin America and other select countries.
The Iams and Eukanuba brands will be part of Mars Petcare, joining brands Pedigree, Whiskas, My Dog, Dine, Optimum, Royal Canin, Nutro and Advance. The move is a strategic addition to the company's pet care portfolio that will enable Mars Petcare to meet the needs of more customers and pets in Australia and New Zealand, said the company. "Owning a pet is an important part of many people's lives in Australia and New Zealand—there are over 8.5 million pet cats and dogs," said Sylvia Burbery, general manager Australia, Mars Petcare. "Pets are an essential part of society and provide invaluable support in facilitating human interaction, social connections and providing companionship. Iams and Eukanuba are great products and are a welcome addition to our petfood offering. They complement our existing brands and will help us better meet the needs of our much loved pets."

SHV Holdings bids €2.7 billion for Nutreco

SHV, a family-owned Dutch investment firm, has reached a conditional agreement to buy animal feed and nutrition company Nutreco (parent company of Trouw) for €2.7 billion (US $3.4 billion), expanding into food-related businesses.

Nutreco said it had received guarantees from SHV that it would continue its growth strategy, including acquisitions, and that it would keep its headquarters in the Netherlands. "SHV will be an excellent partner, enabling us to maintain our corporate identity, culture, values and organization," said Knut Nesse, CEO of Nutreco. Under the terms of the agreement, SHV will pay for the acquisition in cash from its own financial resources.
The offer for Nutreco is expected to open in the final quarter of 2014 and Nutreco's executive and supervisory boards recommended shareholders accept it, the companies said in a statement. It is subject to regulatory approval.

Cargill to acquire Pet Carousel

Cargill announced February 10, 2014, that it is acquiring Sanger, California, US-based Pet Carousel, a private company formed in 2003 that produces branded and private label pet treats and chews. The transaction is expected to close on, or about, February 28, 2014. Terms of the acquisition were not disclosed. Pet Carousel is part of the pet treat and chew category that generates approximately $1.4 billion in annual US sales.

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Viewed as an investment that complements Cargill's existing California distribution and beef processing businesses, Pet Carousel is an established company with a national reach and is positioned as a provider of all-natural pet products made from high-quality, USDA-inspected, US raw materials. Pet Carousel will benefit from Cargill's nationwide distribution capabilities and raw material supplies from the company's US beef, pork and turkey processing facilities.
In addition to a product line that includes private label brands, Pet Carousel produces and markets Roper brand cotton blend chew ropes, Choo Hooves brand natural bones and chews, as well as a line of natural white meat chicken and turkey jerky, and sweet potato and vegetable chews.
Additional synergies will result in more environmentally responsible products that do not require international transport from various points around the world.
Pet Carousel's 36,000-square-foot facility in Sanger, employing 25 full-time employees, will continue to produce the company's line of pet treats and chews with increased investment for innovation and new products.

Aller Petfood to acquire Turkish petfood company

Aller Petfood will take over the management of the Turkish petfood company Petfood Sanayi Ve Ticaret. The takeover is part of the Aller Petfood strategy 2013-18. 

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Henriette Bylling, CEO of Aller Petfood, says: "With this transfer of management, we produce in-and hence also service-three important geographical areas. The EU market through the Danish plant, Russia and the CIS countries through our two Russian production facilities and now also Turkey and the MENA countries."
Previously, Aller Petfood established business with companies in the Turkish market such as supermarket chain, Migros, which it estimates to account for 60 percent of total sales of petfood in the supermarket channel in Turkey. Aller will also take over supplying to online retailer Hepsiburid, as well as pet trade distributors Global and Beta, and brands including Buddy and Pets Choice.
Bylling said: "It is important to me that we have the same spirit in all divisions as with regards to quality. I will not say that I hold the golden recipe for success in all markets, but I will admit that we are going to use all the experience that has led to our success in Russia, to expand the business in Turkey. There is a lot of knowledge and know-how to be shared among the personnel in Denmark, Russia and Turkey. We are truly an international player."

Natural Balance Pet Foods, Del Monte sign merger agreement

Del Monte Foods and Natural Balance Pet Foods Inc. have signed a merger agreement. As part of the agreement, Natural Balance Pet Foods, makers of super-premium dog and cat food, will join Del Monte’s pet products portfolio.
The merger includes the equity interest held by private-equity firm VMG Partners. 
“Natural Balance will continue to offer pet parents super-premium, high quality formulas that they have come to know and expect, and we look forward to continuing to nurture our valued relationships with our customers and other partners,” said Joey Herrick, president and founder, Natural Balance.

Dutch petfood manufacturer Witte Molen acquired by Laroy Duvo

Dutch petfood manufacturer Witte Molen was recently acquired by Belgian pet supplies company Laroy Duvo.
The small animal food manufacturer brings more than 250 years of experience to Laroy Duvo. The combined companies are expected to result in consolidated sales of nearly EUR50 million (US$64.3) and employ 160 people.

Pet food manufacturer C&D Foods acquires Arovit

Pet food manufacturer C&D Foods Group recently acquired Danish private-label company Arovit Acquisitions for an undisclosed amount.
The deal would give the combined pet food company turnover of about €320 million (US$412.9 million) in 2012, according to Philip Reynolds, C&D Foods CEO. The deal is subject to competition clearance in Germany.
“We will hopefully now have a customer base that stretches right across Europe,” Reynolds said.

Perrigo Co. to purchase Sergeant's Pet Care for $285 million

Perrigo Co., a manufacturer and distributor of over-the-counter and generic prescription drugs for the human market, will purchase Sergeant’s Pet Care Products Inc. in an all-cash transaction valued at $285 million, according to the companies.
Privately held Sergeant's Pet Care Products manufactures the Vetscription Cat Hairball Remedy, Geisler line of food and treats for birds and small animals, and the Atlantis line of fish food. The company anticipates sales of more than $140 million in fiscal 2012.
“This acquisition allows us to penetrate the pet care category by offering numerous flea and tick, health and well-being, and consumable products to pet owners at affordable prices,” Perrigo chairman and CEO, Joseph C. Papa said. “Sergeant’s has a proven record of innovation, high-quality manufacturing with great customer service. We welcome Sergeant’s 200-plus employees and over 1,000 SKUs to the Perrigo family.”
The acquisition is expected to close in the second quarter of 2013.

French pet food companies to merge in US$23.4 million investment deal

French pet food manufacturer Continentale Nutrition confirmed that investment funds AgroInvest and India Invest will invest 19 million euros (US$23.4 million) to acquire a joint stake in the company, merging Villeneuve Petfood with Continentale Nutrition.
Continentale Nutrition also announced that regional public property company Communauté d’Agglomération du Boulonnais will buy its logistics platform for 10 million euro (US$12.3 million). The merger of Continentale Nutrition and Villeneuve Petfood will mean the companies employ a total of 922 people. 

German pet product company Rondo Food buys Ireland pet treat manufacturer

German pet product company Rondo Food GmbH & Co. KG bought Ireland-based Gaines Europe Ltd., a manufacturer of treats for dogs and cats.

Rondo Food will continue production in Ireland with approximately 70 employees on the present scale. The company belongs to both managing directors, Dirk Wellen and Thilo Kühne.
“With the acquisition of Gaines, we want to strengthen our activities outside Europe,” said managing director for sales, Thilo Kühne.

Advent to acquire Provimi Pet Food for €188 million

Advent International has announced that it has agreed to acquire Provimi Pet Food for an enterprise value of €188 million (US$265.1 million).
The investment by Advent International will support PPF’s growth plans, focused on increasing its petfood market share through organic growth, developing a new range of products and services and entry into new markets. “Provimi Group has established PPF as a European market leader," said Chris Mruck, managing partner and co-head of Central Europe, Advent International. "Our investment will build upon these strong foundations, enabling the business to capitalize on the growth opportunities that exist across Europe. PPF is a business with excellent prospects and we look forward to working with the management team to develop the company to its full potential.”
The transaction is expected to complete within the next two months following regulatory and works council processes.

Menu Foods unit holders approve Simmons Pet Food takeover

Unit holders of Menu Foods Income Fund  approved a US$239 million takeover offer from Arkansas USA-based Simmons Pet Food Inc.
According to Menu Foods, 99.94% of its units and special trust units voted to approve the deal, which is expected to close in early November pending regulatory approvals. Following a massive petfood recall three years ago involving Menu Foods, the company put itself up for sale after a strategic review earlier this year. The acquisition of Simmons Pet Food marks the end of Menu's struggle to overcome the tainted petfood recall.

Nestlé to acquire US-based Waggin’ Train

Nestlé has agreed to acquire the Waggin’ Train dog snacks business in the US. Waggin’ Train makes real-meat dog snacks.
Within the pet care industry, the dog snacks category has enjoyed higher-than-average growth, cites Nestlé, and Waggin’ Train has seen annual growth rates of approximately 30 percent during the last three years.
Waggin’ Train had sales of around US$200 million for the twelve months ending June 2010.
The transaction is expected to be completed by the end of September.

Is the M&A market heating up for petfood?

A couple months ago, it was Procter & Gamble announcing it's acquiring Natura Pet Products. (See what your fellow Petfood-Connection.com members had to say about that.)
Around that same time, an investment group in Canada announced it's buying Petra Pet Inc., parent company of pet treat manufacturer Beefeaters.
Now comes word that a global equity firm, the Riverside Co., is buying one of the only two petfood companies in Turkey. Tropikal petfood was founded in 1999 as a distributor for international brands such as Sport Mix, Pro Pac and Beaphar. It began making its own dry petfood in 2005, becoming the first domestic petfood producer in Turkey, it says, with brands Goody, Champion, JFD and JFC. The latter two are new lines.
With its new brands and an annual capacity of 7,500 tons--and being based in a rapidly developing market for petfood--one can see why a company like Tropikal would be attractive to investors. Or really, why any petfood or pet care company would be attractive, given how well the pet industry has ridden out the economic storm.
Does this mean the mergers and aqcuisition (M&A) market is heating up for petfood? What other mergers or acquisitions do you expect to see this year?

Investors: Nestle should buy natural petfood maker

Nestle may aim to expand further in the petfood industry, according to an article from Bloomberg Businessweek, and investors are urging it to consider buying a natural petfood maker to better compete with Proctor&Gamble, the recent purchaser of Natura Pet Products Inc.
After a deal to sell its shares of Alcon Inc. to the majority owner, Novartis AG, Nestle will receive US$28.1 billion. With this, investors also want Nestle to expand operations into emerging markets. The company has a list of five markets it is looking to enter, according to John Harris, Nestle Waters chief executive.

Procter & Gamble to acquire Natura Pet Products

Procter & Gamble (P&G), owner of the Iams and Eukanuba brands of petfood, has signed a deal to acquire privately held Natura Pet Products, based in Davis, Calif.
P&G, based in Cincinnati, Ohio, USA, says the move allows it to "expand into the attractive holistic and naturals segment of the petfood category," complementing the company's current petfood brands and helping advance an overall growth strategy of "reaching more consumers in more parts of the world more completely."
Natura's brands include Innova, Evo, Healthwise, California Naturals, Mother Nature and Karma. Its products are sold in pet specialty stores and veterinary clinics, mainly in the US and Canada.
"Its time for the right company to take our brands to the next level of growth. P&G is that company," says John Rademakers, founder and owner of Natura. "We know that P&G will honor our history as they capitalize on their strengths to build these brands."
The deal is expected to close in about a month.