Beverages

Danish $22 bln enzyme M&A is costly bet on growth

12 Dec 2022

Novozymes will absorb smaller domestic rival Chr. Hansen. The 38% premium dwarfs expected synergies from the deal. And Novo Holdings, the biggest shareholder in both groups, will retain majority voting rights. Novozymes investors look to be paying too much for future growth.

Oatly’s best turnaround recipe is dollops of cash

25 Nov 2022

Shares in the $950 mln faux-milk maker are down 80% this year, and revenue growth is slowing. CEO Toni Petersson will struggle to stop burning cash, and has ruled out selling the company. That means a looming capital hike may have to be much bigger than he currently thinks.

Energy crisis gives beermakers a lasting hangover

26 Oct 2022

Heineken’s shares fell 10% after reporting weaker-than-expected sales. Inflation is eroding punters’ disposable income, making it harder for brewers to raise prices like in previous crises. Soaring costs for fuel and wheat, which bite next year, pose a further threat to margins.

Alan Jope exit is easiest step of Unilever revival

26 Sep 2022

Shares in the $111 bln Dove maker rose after it said its CEO would leave by end-2023. A botched bid for GSK’s personal health arm hit Jope’s credibility. But even with a new broom Unilever will struggle to pull off a big deal, and selling lower-growth units looks harder to do.

Starbucks’s high-octane plan has warm impact

14 Sep 2022

The $101 bln coffee firm spent a chunk of its investor day discussing solutions for its restless workforce. They are sure to give incoming CEO Laxman Narasimhan a challenge. But revenue is growing rapidly thanks to automation. Pretty soon, employees won’t have the same effect.

Health adds new letter to ESG for food groups

12 Jul 2022

Government crackdowns on junk food marketing will hurt sales for companies like Frosties maker Kellogg. And investors are increasingly pushing consumer groups to use independent criteria to show how healthy their grub is. Tougher scrutiny will mean a valuation slap for laggards.

Plant-based food stocks lack sustainable finance

10 Jun 2022

Shares in faux-milk maker Oatly and plant-based burger purveyor Beyond Meat have tumbled this year. Despite flimsy gross margins, both still trade at a premium to bigger food rivals. Without a plan to cut costs, they will struggle to attract buyers or survive on their own.

AB InBev’s low-alcohol miss has sobering effect

27 May 2022

The world’s biggest brewer wants 20% of its beer volume in 2025 to contain little or no alcohol. Hitting the booze-free target requires unlikely growth of 30% a year. That puts a dampener on CEO Michel Doukeris’s do-gooder vibes, as well as his sales and margin potential.

Capital Calls: AB InBev

5 May 2022

Concise views on global finance: Anheuser-Busch InBev’s revenue grew 11% in the first quarter compared to last year, but rising prices are a particular headache for the debt-laden brewer.

Capital Calls: Blackstone, German chips, Guy Hands

27 Jan 2022

Concise views on global finance: The $140 bln group braces for falling asset values and rising interest rates; Berlin sends the wrong signal by ignoring a 4.4 bln euro offer for wafer maker Siltronic; Britain seeks to reverse the financier’s lucrative 1996 housing deal.

Capital Calls: Remy Cointreau, African petrol

25 Nov 2021

Concise views on global finance: With profits soaring, the cognac maker will face mounting pressure for M&A; commodity trader Vitol buys out minority shareholders in London-listed fuel distributor Vivo.

Monster fizz and Corona would make icky cocktail

22 Nov 2021

The $47 bln energy drink maker may be in talks to merge with Constellation Brands, which sells beer and wine. Both have reason to try a new tipple, but savings would be scant given differences in distribution. And a more sprawling business may command a valuation discount.

Capital Calls: Stadium naming, Diageo, Evolution

17 Nov 2021

Concise views on global finance: Crypto.com is paying heavily to rename Staples Center; The drinks maker plans to grow its market share by 50% in the next decade; the $36 bln Swedish gambling firm lost $2 billion of its market capitalisation after accusations of illegal gambling.

FX risks dilute appeal of Heineken’s Africa tipple

15 Nov 2021

The Dutch brewer is buying South Africa’s Distell for $3 bln and taking over Namibia Breweries. With modest cost savings, CEO Dolf van den Brink can make a spirited return. But he’ll have to flog more Amarula liquor beyond the continent to ease the headache of wobbly currencies.

Sweetgreen IPO is flavored with star power

10 Nov 2021

The Naomi Osaka-backed upstart touches all the food fads: online ordering and appeal to the health-and-time conscious. But it is asking for a premium valuation compared to established fast food companies like Chipotle as a result. Osaka can’t compensate for salads’ lack of spice.

Capital Calls: Couch-potato habits help Roblox

9 Nov 2021

Concise views on global finance: The video game app’s shares surged 36% on Tuesday after it said sales nearly doubled in the quarter.

Unilever’s tea makes for a tasty buyout brew

2 Nov 2021

The Dove maker is selling brands like PG Tips and Pukka, worth perhaps 4 bln pounds. Bringing sales to a proper boil could give private equity giants like Carlyle or Advent an invigorating 19% return. CEO Alan Jope’s struggling personal care lines may not hit the same sweet spot.

Coke dons extra armor in fight against Pepsi

1 Nov 2021

The soda company is leveling the playing field by buying the rest of sports drinks maker BodyArmor that it doesn’t already own for $5.6 bln. The fast-growing brand helps Coke grow in a category dominated by PepsiCo’s Gatorade, just as beverage sales are picking up again.

Capital Calls: Aussie climate plan stumbles

28 Oct 2021

Concise views on global finance: The federal government won’t sign a pledge to reduce methane emissions.

Capital Calls: McDonald’s, GM, Worldline

27 Oct 2021

Concise views on global finance: The $177 bln fast-food chain boosted sales by making it easier to get burgers and nuggets; supply shortages are exacerbating the carmaker’s heavy investment bill; shares in the French payments group tumbled despite ambitious growth targets.