The food industry was rocked this week with what is set to be the largest-ever takeover in the food sector: Heinz sold to Warren Buffett’s Berkshire Hathaway fund and 3G Capital for US$28bn. The horsemeat saga trundled on, with arrests in the UK, as well as the first set of industry-wide tests. Results also poured in from the likes of PepsiCo, Mondelez International and Nestle.
“It’s our kind of company. They’ve got a group of fantastic brands, led by ketchup. I’ve sampled it many, many times” – US investor Warren Buffett speaking to CNBC following his fund’s deal to buy Heinz.
“This company’s never been stronger. That doesn’t mean there won’t be changes going forward but I think, ultimately, this will be a platform for doing bigger and better things in this industry” – Heinz CEO Bill Johnson says the company is being taken over from a strong position following the deal with Buffett’s Berkshire Hathaway and private-equity firm 3G Capital.
“North America was a very very good platform that has driven and is accretive to the group. On growth it has been softening in some platforms like frozen food … but we have very many pots of growth there and that includes frozen” – Nestle CEO Paul Bulcke tells just-food he is “never satisfied”, when asked how he viewed Nestle’s performance in North America in the last year.
“The FSA are being untruthful. They have been informed, there is a complete paper trail so they have known about it and to pick on me now doesn’t make sense in any way, shape or form, I can’t work it out” – Dafydd Raw-Rees, director of Farmbox Meats, one of the UK companies raided in police investigations into the horsemeat contamination, told the BBC he thought the Food Standards Agency was “picking on him”.
“Spanghero can confirm that it has only ordered, taken delivery of and re-sold meat reputed to be beef and duly labelled as such in conformity with EU and French regulations” – French meat processor Spanghero continues to deny any wrong-doing in the horsemeat saga after the French government pointed at the firm for passing horsemeat off as beef.
“The stock has been invested in, for many investors, because of that top-line potential. So just saying: ‘We are quite confident that we can deliver on our 5% plus next year’ I hope you can understand that may not be enough for some people” – JP Morgan analyst Ken Goldman questions Mondelez’s outlook on organic sales growth.
“There is a very large turnaround possibility and there is a good swing effect if we can turn [the business] around. We have implemented lots of different activities in order to make the business more healthy. We view it in an optimistic way” – after Hakon Invest struck a deal to buy out Ahold in its retail venture ICA, the investment fund’s CFO Göran Blomberg says the main challenge is to turn around the retailer’s Norwegian business.
“The internet injects a lot more transparency into supermarketing these days. As such, the time advantage from extensive cuts is limited with price matching around” – Shore Capital analyst Clive Black explains that the advent of digital technology and the transparency that has brought means that price cuts are not a competitive advantage for very long.
“The growth for the next semester is now about grabbing the low-hanging fruit that we have in front of us. It is reducing costs and it is also exploiting the new opportunities that arise because we now have more market muscle in Europe” – Raisio chief executive Matti Rihko tells just-food the Benecol and Sugar Puffs owner will look to cut costs from the business by driving synergies, while also exploiting cross-selling opportunities.
“We stand behind our products and the accuracy of our label – and we disagreed with plaintiffs on the merit of this case. But we agreed to resolve the matter to avoid further litigation” – a spokesperson for General Mills insists the health claims made in association with probiotic yoghurt products are accurate after it settled a lawsuit in the US questioning health claims associated with its YoPlus probiotic yoghurt.