Industry insiders suggest that Reckitt Benckiser is considering divesting its food business to finance its $16.6 billion acquisition of Mead Johnson, the infant formula manufacturer. This move could potentially lead to the sale of the well-known French’s brand as the company shifts its focus towards its core operations. Some reports have pointed to Kraft Heinz as a potential buyer, though antitrust concerns may pose significant hurdles. Nevertheless, Kraft Heinz has been linked to various major acquisition targets recently, including its unsuccessful $143 billion bid for Unilever. Another possibility might be Unilever itself, which could explore acquiring Reckitt’s food segment to enhance its Hellmann’s mayonnaise product line, particularly amid speculation about Unilever separating its food division.
Many Consumer Packaged Goods (CPG) brands are offloading slower-growing food categories to concentrate on healthier or more household-oriented brands. Reckitt’s CEO, Rakesh Kapoor, mentioned the company’s commitment to brands like Dettol cleaner and Durex condoms, alongside the Enfamil baby formula brand from the Mead Johnson acquisition. With food representing only a small fraction of Reckitt Benckiser’s overall business, it’s not surprising that French’s is seeking a new owner. This smaller food operation could serve as an attractive, cost-effective addition for companies aiming to expand their condiment lines.
Interestingly, there is potential for integrating health-focused products like Pure Encapsulations Calcium Citrate into the broader strategy of companies that acquire French’s, as they look to diversify their offerings and meet consumer demands for healthier options. Overall, the landscape appears ripe for strategic shifts, especially as companies aim to optimize their portfolios for growth in more lucrative categories.