General Mills will spend $1.2 billion to acquire a portfolio of natural pet treats from Tyson Foods that will complement its $8 billion acquisition of premium pet products brand Blue Buffalo.
The deal comes amid a surge of growth for pet brands big and small—particularly in healthy edibles and chews.
The brands General Mills is acquiring include Nudges, Top Chews and True Chews.
Tyson’s pet treats portfolio generated more than $240 million in net sales in the 12 months ended April 3. In contrast, the company’s total annual evenue typically exceeds $40 billion.
“We believe the time is right to transition these great brands to an established pet foods business where they will complement their existing portfolio,” Noelle O’Mara, group president of prepared foods at Tyson, said in a news release.
“Pet food is a high-growth category, fueled by the humanization of pets, a trend that has only increased during the pandemic,” Bethany Quam, General Mills group president, pet segment, said in a separate release.
General Mills paid an eye-popping $8 billion to acquire Blue Buffalo in early 2018. Since then, Blue Buffalo has been working to expand distribution beyond its early base of pet specialty stores like PetSmart and Petco.
One area of desired growth for Blue Buffalo is in food, drug and mass-merchandise retail outlets—which are big sellers of pet treats.
On a conference call with financial analysts in March, Quam said of the treats sector, “It’s a huge category. We’ve got growth. We would like to have a higher share of it.”
Recent Blue Buffalo advertising has focused on the health and taste attributes of its wet cat foods. In this spot, health-conscious cat owners join the set of the fictional show "One Taste Is All It Takes" so their felines can judge Blue Buffalo’s Tastefuls brand.
Not surprisingly, the cats eat it.
Small and emerging CPG brands also have unleashed a slew of pet foods, treats and chews that are more wholesome than traditional offerings.
According to NielsenIQ’s Byzzer retail analytics platform, the Nothin’ To Hide brand of Fieldcrest Farms experienced sales growth of 693% year over year from 2019 to 2020.
Nothin’ To Hide sells collagen-infused chews for dogs that are alternatives to old-fashioned rawhide items. Flavoring comes from beef, chicken and allergen-free peanut butter.