Tallahassee Journal

Campbell Soup buys salsa maker Garden Fresh Gourmet for $231M

Campbell Soup buys salsa maker Garden Fresh Gourmet for $231M

Campbell Soup Co. said Tuesday it has agreed to buy salsa maker Garden Fresh Gourmet for $231 million, the latest move in its ongoing strategy to diversify beyond soup. Garden Fresh Gourmet, which also makes hummus, dips and tortilla chips, generated $100 million in net sales last year, Campbell said. “The acquisition of Garden Fresh Gourmet is another milestone in reshaping our portfolio toward faster-growing categories, including packaged fresh and organic foods,” said Campbell CEO Denise Morrison in a statement.635694335871398089-GFG-Topped-Hummus-Concept-RP-No-Snipe

Garden Fresh, which is based in Ferndale, Mich., will become part of the Campbell Fresh division (formerly called Packaged Fresh division), which has become increasingly important in Morrison’s efforts to boost Campbell’s revenue at a time when more health-conscious consumers are staying away from packaged and canned foods. The unit also operates Bolthouse Farms products, including carrots, juices, salad dressings and snacks.

Sales of packaged fresh foods industry-wide grew 4.9% last year to about $19 billion, Campbell said. “Garden Fresh Gourmet will allow the Campbell Fresh division to expand in the deli section of the grocery store perimeter,” said Jeff Dunn, president of Campbell Fresh, in a statement. Jack and Annette Aronson founded Garden Fresh Gourmet in 1998 after they began making salsa at their restaurant and started to package it for a local grocer. It now has about 500 employees.

Campbell has made acquisitions in recent years to bolster its non-soup categories, including Bolthouse Farms, baby-food company Plum and biscuit maker Kelsen. Campbell’s fiscal third quarter report, released last month, showed that the strategy is starting to move the bottom line. Net earnings fell slightly to $182 million vs. $184 million a year ago. But its gross profit margin increased to 35.9% from 34.3% as its non-soup items are priced higher and the company can cut back on coupons and promotions. Company-wide sales fell 4% to $1.9 billion for the quarter. U.S. soup sales fell 10%.

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