Blog: Dean BestWill Ralcorp thrive in new Post?

Dean Best | 15 November 2007

Cereal gave a good kick-start to the day for both Kraft Foods and US private-label firm Ralcorp Holdings this morning (15 November).

Ralcorp has snapped up Kraft’s US cereals business Post in a deal worth US$2.6bn.

For Ralcorp, a purveyor of private-label products, the deal gives it a stable of popular US brands. For Kraft, the sale represents another move to shed businesses it no longer sees as key to its future success.

However, for all Ralcorp’s optimism, there will be questions over how its retail customers in the US will view a brand now belonging to one of their key private-label suppliers.

One analyst asked Ralcorp today how the company thought Post would fare under its ownership; would retailers be “amenable” to a private-label firm running the brand?

Ralcorp co-CEO and president David Skarie said he “couldn’t speak for our customers” but added that the company would look to manage Post as a “distinct business”.

Ralcorp sees the acquisition of Post, the third-largest branded cereals business in the US, as “transformational”. It will hope it can soon transform its reputation as a seller of strong branded goods in the eyes of US retailers.


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