Food & Beverages

Delivery Hero investors’ meal is stuck in traffic

13 Dec 2024

Shares in the $9.5 bln online takeaway group have dipped since it sold a $2 bln stake in its Middle East unit through a Dubai IPO. CEO Niklas Östberg can now cut net debt, but many of his businesses still burn cash. A more comprehensive breakup may be the best option on the menu.

Sour grapes spill beans on squashed grocery deal

11 Dec 2024

After trying to unite for two years, Albertsons and Kroger each claimed the other broke their contract a day after US judges nixed the $25 bln merger. The blame game may well end in a stalemate. It also suggests trustbusters astutely divined a ruthlessness veiled in so much M&A.

Hershey would be a bitter confection to swallow

10 Dec 2024

The Reese’s chocolatier may again be a takeover target for Cadbury owner Mondelez. Anti-obesity drugs and the recent Mars-Kellanova merger make the 2016 idea worth reconsidering. Financing a $50 bln deal will be tough, however, requiring dubiously huge synergies to justify.

Starbucks coffee in China is better served to-go

27 Nov 2024

New boss Brian Niccol has a geographical dilemma. Crazy concoctions are flustering US baristas while Chinese customers want more new beverages. He’s better off focusing on the home market and spinning off the second-biggest business. It’s probably only worth about $7 bln anyway.

New Nestlé CEO wakes up and smells the bad coffee

19 Nov 2024

The KitKat maker’s boss Laurent Freixe unveiled a plan to get the $230 bln group moving again. Yet a 4% sales-growth target and unchanged operating margin seem low. Cutting $2.8 bln of costs to invest in marketing makes sense, but he’ll have to battle rising ingredient prices.

Just Eat’s discount deal puts CEO on notice

13 Nov 2024

The food delivery firm finally sold Grubhub for $650 mln, a stark decline from the $5 bln it paid three years ago. Investors’ cheer reflects that they feared an even worse price, and it gets rid of a dead weight. But Just Eat boss Jitse Groen can’t afford any more mistakes.

Gulf IPO may be Delivery Hero’s only tasty morsel

11 Nov 2024

The Frankfurt-listed group is selling 15% of Talabat in Dubai. A potential $13 bln valuation would mean an arm with a third of its sales is worth more than Delivery Hero itself. Yet beyond the Gulf, a value-boosting breakup looks hard given the business overall makes a loss.

French fries make a tasty $11 bln takeover target

5 Nov 2024

Lamb Weston, which sells spuds to McDonald’s and others, is under pressure from pushy investor Jana. A bolder turnaround plan could get messy and leave it a hard-to-value oddball anyway. It’s a better side dish for a peer like agribusiness giant Cargill or cereal company Post.

It’s safe to count chickens even before they hatch

30 Oct 2024

Bigger and faster-growing fowl keep pushing prices lower and consumption higher. The $50 bln US industry is cooking, evidenced by Pilgrim’s Pride’s profitability, Chick-fil-A’s entertainment app, and more. None of it, though, will end a cyclicality that runs like cluckwork.

Danone’s yogurt bounty can spur M&A spree

24 Oct 2024

The $47 bln company once lagged rivals like Nestlé and Unilever. But its portfolio of nutrition and dairy products is now driving stronger growth as it caters to health-conscious consumers. With a stronger balance sheet, CEO Antoine de Saint-Affrique can start splurging on deals.

McDonald’s moves off the grill and into the fryer

23 Oct 2024

An E. coli outbreak prompted the $210 bln fast-food chain to yank its Quarter Pounder in some places. The response suggests it can handle a health crisis quicker than Chipotle did. With high prices already hurting sales, though, it can’t afford to scare off more customers.

Why brewers are betting big on alcohol-free beer

22 Oct 2024

Consumers are shunning booze due to health concerns and shifting tastes, forcing beermakers to adapt. In this episode of the Big View podcast Louise Fitzpatrick, an executive at the Dutch brewer Heineken, explains the opportunities and challenges of selling suds without alcohol.

Nestlé’s CEO needs to ride two horses at once

17 Oct 2024

Laurent Freixe, the new boss of the $260 bln KitKat maker, inherits a group with stalling sales growth. Longer term he will have to shuffle an outdated food portfolio. But right now he needs a splurge on marketing, or risk Nestlé’s market share withering on the vine.

China’s EU reply cuts odds of damaging tit-for-tat

8 Oct 2024

Days after Brussels voted for electric-vehicle tariffs, Beijing penalised European brandy. Pork, dairy and pricey cars may be next. Yet the moves are well-flagged. And more damaging retorts, like hitting luxury or $9 bln of aircraft-linked imports, seem unlikely for now.

Drink giants’ risky new plan: quantity not quality

1 Oct 2024

Liquor makers like $80 bln Diageo until recently focused on ‘premiumisation’, where customers consume less alcohol but pay up for fancy brands. With punters feeling the pinch, that strategy looks dicey. Yet flogging more cheap booze is optically awkward and financially painful.

India’s Swiggy tries enticing IPO bargain hunters

30 Sep 2024

The money-losing food delivery group is eyeing a valuation of up to $15 bln, or 10 times forecast sales, in its debut. That’s a sensible discount to profitable and faster-growing rival Zomato. The bet is that customer loyalty and improving earnings will help Swiggy catch up.

Franco-US food M&A is $10 bln recipe for heartburn

26 Sep 2024

Sodexo, the $13 bln caterer, is eyeing US rival Aramark according to Bloomberg. The returns look low, absent huge cost savings, and a cash deal would leave a debt headache. Recent iffy takeovers in the business-services sector show that scale isn’t always worth the risk.

New consumer CEOs start life in the slow lane

24 Sep 2024

Nike joined Campari, Nestlé and Starbucks in abruptly ditching its boss. There’s plenty of scope for the new CEOs to remedy their predecessors’ missteps. But a common thread at the four groups is slowing sales amid consumer weakness, making the turnaround jobs much tougher.

Beijing IPO meddling leaves bad taste in Hong Kong

23 Sep 2024

Regulators have put three bubble tea firms’ offerings on hold. Why? Because listed peers have performed poorly amid tough competition, Reuters reports. That may be true, but it’s a decision for companies and investors. China’s heavy handedness bodes ill for the city’s bourse.

Campari can win back drinkers with marketing binge

18 Sep 2024

The $10 bln Aperol maker’s shares fell after the abrupt departure of CEO Matteo Fantacchiotti. He had a gloomy outlook because consumers aren’t splurging on pricey spirits. The next boss will have to position the company for the next bounce by leaving their card behind the bar.