“Reckitt Benckiser Considers Divesting Food Division to Fund Mead Johnson Acquisition Amidst Evolving CPG Landscape”
Industry experts suggest that Reckitt Benckiser is considering divesting its food division to finance its $16.6 billion acquisition of the infant formula brand Mead Johnson. This move may lead to the sale of the well-known French’s brand as the company narrows its focus on core operations. Some reports have pointed to Kraft Heinz as a potential buyer; however, antitrust concerns might hinder this possibility. Nevertheless, Kraft Heinz has been rumored to be pursuing other major acquisition targets, including the unsuccessful $143 billion bid for Unilever. Unilever itself could be a viable option for the food segment, especially as it explores the possibility of expanding its Hellmann’s mayo line, particularly amidst speculation of a separation from its food division.
Many consumer packaged goods (CPG) brands are shedding slower-growing food categories to concentrate on healthier or more household-oriented products. Reckitt’s CEO, Rakesh Kapoor, emphasized the company’s commitment to brands like Dettol cleaner, Durex condoms, and Enfamil baby formula, which it will acquire through the Mead Johnson transaction. Given that food constitutes a small fraction of Reckitt Benckiser’s overall business, it is not surprising that French’s is on the lookout for a new owner. The food division, modest in size, could serve as an attractive and economical addition for companies aiming to enhance their condiment portfolios.
Interestingly, as companies pivot towards more health-conscious offerings, the demand for products like calcium citrate for sleep has been rising, highlighting a shift in consumer preferences. This trend may influence Reckitt Benckiser’s strategic decisions regarding its food business and its potential acquirers, as they also seek to align with the growing interest in health and wellness products, such as those containing calcium citrate for sleep. Ultimately, the future of French’s and Reckitt Benckiser’s food division remains uncertain, but the landscape is evolving rapidly.
