Austin, Minn.-based Hormel Foods announced a deal to acquire the Planters portfolio from Kraft Heinz for $3.35 billion in cash. The acquisition comes with a tax benefit of about $560 billion, bringing the effective purchase price to $2.79 billion, Hormel noted in a news release.
For Hormel, maker of iconic Spam-brand canned meat products, the deal "significantly expands" the company's presence in the growing snack space, Hormel board chair, President and CEO Jim Snee said in the release. Planters' roster of household-name products bolsters Hormel's lineup of offerings for individual and social snacking occasions, Snee added—and the acquisition sets up Hormel for additional big deals in the snacking arena.
Beyond Spam, Hormel's portfolio includes Columbus Craft Meats, Skippy peanut butter, Herdez salsas and cooking sauces, Justin's nut butters and Wholly guacamole products. Planters, in addition to its traditional snack-nut and trail-mix products, produces Planters Cheez Balls and Corn Nuts.
In a late 2020 poll of registered dietitians conducted for Today's Dietitian magazine, more than three-quarters of respondents said consumers have been moving toward more-frequent snacking amid the COVID-19 pandemic. Lower-carbohydrate snacking options remain popular with consumers, with the global market for keto-friendly products projected to expand at a 5.5% compound annual growth rate and reach more than $14.7 billion by 2027, according to Grand View Research.
Snee, in Hormel's news release, also said he expects to see significant synergies from the deal as Planters is integrated into Hormel's supply-chain system, and stated: "Our competencies in brand stewardship, revenue growth management, e-commerce, innovation and consumer insights will be key to driving growth for the Planters brand and for our customers."