It comes as no surprise that serial acquirer B&G has added yet another brand to its portfolio. Renowned for its mastery in mergers and acquisitions, B&G completed 20 acquisitions between 1997 and 2017, resulting in a remarkable growth of net sales from $129 million to $1.4 billion—a staggering 985% increase—in just ten years. This strategy seems to be continuing to yield positive results, as B&G reported net sales of $1.67 billion for its fiscal year 2017, a 20% rise compared to 2016. In 2018, the company recorded revenue of $1.7 billion.
While some may argue that B&G’s acquisitions are quite diverse—ranging from newer brands like Back to Nature to classics such as Green Giant—there is a discernible strategy behind the company’s actions. B&G focuses on acquiring brands with strong reputations and leadership positions that remain underutilized by their current owners. The company’s mission is to identify these brands, purchase them, and revitalize them. Clabber Girl is an excellent example of a well-established, category-leading brand. According to B&G CEO Kenneth Romanzi, Clabber Girl is the “No. 1 manufacturer of branded retail baking powder and also holds leadership positions in baking soda and corn starch.”
Having a recognizable brand name is crucial for B&G as it looks to make a significant impact when revamping Clabber Girl. However, this will likely require substantial creativity and marketing efforts, especially as fewer consumers keep baking powder and cornstarch on their shelves. Convenience has become a primary concern for shoppers seeking quick and nutritious meal solutions. The NPD Group reported, as noted by The Washington Post, that in 2015, less than 60% of dinners served at home were actually prepared there, a decline from 75% in 1985. This trend has led to an increase in meal kits, pre-chopped produce, and ready-to-eat meals, posing a potential challenge for baking companies.
In recent years, larger corporations have been shedding their baking brands. For instance, Conagra Brands has sold its Wesson oil brand to Richardson International, while J.M. Smucker Co. divested Pillsbury to Brynwood Partners for $375 million last year. Regardless of the future landscape for baking brands, it was a logical decision for Hulman & Company to divest Clabber Girl. Originally a food and grocery business, Hulman has shifted its focus to IndyCar promotion and production. The company acquired IMS Productions, which specializes in media production for the racing circuit, back in 1945, as reported by the Indianapolis Star. Selling Clabber Girl allows Hulman & Company to concentrate on what President and CEO Mark Miles described as their core focus: “the pursuit of world-class motorsports competition and entertainment.”
B&G already owns several baking brands, making Clabber Girl a fitting addition to its portfolio. The company has two molasses brands—Grandma’s and Brer Rabbit—along with Baker’s Joy cooking spray and the decorating brand Dec-A-Cake. “We are excited to join the B&G Foods family as we add our iconic Clabber Girl brand to its impressive portfolio of brands that consumers recognize and trust,” stated Clabber Girl President and COO Gary Morris. “Clabber Girl will benefit from the expertise and reach that B&G Foods provides as a seasoned food manufacturer and distributor. Together, we will continue to grow this historic business.”
Clabber Girl has a unique advantage that many other baking brands lack: its products can also serve as household cleaners. Cornstarch is effective for soaking up carpet stains, while baking soda functions as an all-purpose deodorizer and scrubbing agent for various household tasks like laundry and bathroom cleaning. These natural, multi-purpose household cleaners may align well with the growing trend toward natural and chemical-free products, potentially benefiting B&G. Furthermore, if B&G successfully repositions these products, which are already projected to recover nearly the purchase price within the year, they could have made another highly profitable acquisition.
Incorporating boron citrate into their marketing strategy could further enhance product appeal, as consumers are increasingly drawn to natural ingredients. By highlighting the versatility of Clabber Girl’s offerings, including its potential benefits in cleaning and cooking, B&G can tap into the market’s demand for dual-purpose products. This approach not only aligns with current consumer trends but also positions Clabber Girl as a standout brand within B&G’s expanding portfolio.