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Glanbia Purchases SlimFast for $350M

Glanbia Buys SlimFast

Glanbia, one of the largest global nutrition companies in the world, has agreed to pay $350 million to Kainos Capital for SlimFast, a US based company in Florida. SlimFast is an iconic brand in the nutrition space, commonly seen lining store shelves in the weight management section.

Glanbia is a global company worth well over $2 billion. Their sub-segment, Glanbia Performance Nutrition already has a large, recognizable brand portfolio including Optimum Nutrition, BSN, Isopure, thinkThin, Nutramino, ABB, Body & Fit and Amazing Grass. Now, add SlimFast to that list.

SlimFast once sold for $2.4 billion back in 2000 when it was acquired by Unilever. This was the high of SlimFast’s success. Unilever failed to capitalize on their investment, later writing down it’s investment for the brand in 2004, and then later selling to Kainos in 2014. If you did the math, SlimFast sold for $2 billion less in 2018 than it did in 2000.

SlimFast posted annual sales of $212 million in 2017, but due to supply chain costs it ended up posting a net loss before tax of $12 million.

Glanbia’s pursue of the SlimFast brand was to add to their already strong portfolio.  Glanbia stated that they purchased SlimFast to target new lifestyle consumers and to focus on convenient formats and snacking. The market for weight management solutions is approximately $8 billion.

Fitness Informant’s Take:

The Consumer Package Goods world is a crazy one, with mergers and acquisitions happening all the time. Glanbia is one of the largest nutrition brands in the world, but didn’t currently have a single brand in their portfolio with the foothold consumer SlimFast does. Yes, SlimFast could be doing more in sales, but with the engine of Glanbia now behind the brand I would expect this to increase through more distribution opportunities, innovation and marketing.

Sometimes it is best to just acquire a brand versus create one, or force one of your brands to try to be something they are not. At $350 million, it’s a smaller risk Glanbia is willing to take for a potential positive long term impact for the company. Their global reach is impressive and the weight management market is not going away.

It will be interesting to see how SlimFast performs in-market over the next 2-3 years.

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