Food & Beverages

Cheap labour fuels India’s newest e-commerce boom

23 Aug 2024

Quick commerce, which promises deliveries of everything from milk to phones in 10 minutes, is growing five times as fast as traditional groceries. That's due to an army of low-earning workers. Amazon and Reliance want in but the market will be tough for new entrants to crack.

Starbucks piles whipped cream atop CEO pay problem

15 Aug 2024

With a potential $145 mln package, new boss Brian Niccol would earn over 10,000 times the average barista. Based solely on the $20 bln of market cap he added, he’s in theory worth far more. Because vibes factor into valuing executives, it’s no wonder compensation keeps rising.

Pringles’ $36 bln deal comes with a pinch of salt

14 Aug 2024

Candy maker Mars is acquiring snack rival Kellanova for $83.50 per share in an all-cash deal. Strategically it’s a fit: adding potato chips to M&M’s rounds out the buyer’s offerings. But a whopping $29 bln financing and a hostile regulatory environment add a dose of uncertainty.

Big Beer’s stumbles leave investors ice cold

14 Aug 2024

Heineken shares are down after it disappointed investors hoping for a sport-fuelled profit party. Rival Carlsberg’s valuation has fallen due to a $4 bln soft drinks takeover. For CEOs, emerging markets growth and deals in the right areas are the only way to add fizz to stocks.

Starbucks CEO starts with venti expectations

13 Aug 2024

The coffee chain added over $20 bln in market value as it named former Chipotle chief Brian Niccol as its new boss. Niccol has useful skills, from digital marketing to steering founder-led companies. Starbucks is bigger, though, as are the personalities he will have to navigate.

Starbucks has too many baristas in the boardroom

12 Aug 2024

The $90 bln coffee chain’s US sales are down as growth in China flags. Add a newish CEO and it seems a tasty brew for rabble-rousers like Elliott. But the complex interplay between former boss Howard Schultz, angsty labor reps and even more activists threatens a bitter finish.

Pringles would make a tasty M&A bite for Mars

5 Aug 2024

Recession fears and weight-loss drugs loom over indulgent snack makers. Yet the M&Ms owner is mulling a bid for $24 bln Kellanova. Even a 30% premium would only match rivals’ valuations; so long as cost savings materialize, taking a bigger piece of a tougher market makes sense.

Soaring coffee prices foretell a financial grind

30 Jul 2024

Robusta futures are off the boil, but near record highs. Espresso drinkers needn’t fret just yet: baristas use more popular arabica, and a $5 cup contains just 7 cents of beans. Rising demand and climate effects, however, are brewing trouble for the $200 bln industry.

Diageo’s succession hangover has fuzzy duration

30 Jul 2024

The $67 bln drinkmaker’s 2023 promotion of CEO Debra Crew was seamless. But Diageo’s share price has slumped since, and some of the problems are self-inflicted. Crew’s future may hinge on a rebound of US consumer sentiment, rather than any bold change of strategy.

Consumer titans have Covid-era issue, in reverse

26 Jul 2024

In the pandemic, Nestlé and Unilever’s higher prices were accompanied by falling sales. Now they are tempting consumers to buy more products, but prices are harder to budge. One issue hasn’t changed: the giants’ vulnerability to cheaper and healthier eating habits.

WH Group’s US spinoff can undo hamfisted bet

23 Jul 2024

The China-based pork producer aims to relist the Smithfield unit it bought for $7.1 bln over a decade ago. Trade wars and swine fever have dashed hopes of integrating US and mainland operations. By the same token, Smithfield's Wall Street return can unlock value for its parent.

Sapporo might get half-drunk on efficiency

18 Jul 2024

After the $3 bln beer maker agreed to rejig its property holdings, activist 3D has detailed exactly how the company should go about it. Japan Inc is warming up to the idea of realising gains on real estate. But there's plenty of room for missteps, even in a seller's market.

Booze-free beverages are no small beer

11 Jul 2024

Carlsberg’s $4 bln deal to buy soft-drinks maker Britvic is just the latest foray by a big brewer into serving the alcohol-averse. In this Viewsroom podcast, Breakingviews columnists discuss whether it’s a seismic tobacco-like shift or a frothy attempt to fizz up profit margins.

EU’s China trade weak spots hide in plain sight

9 Jul 2024

Beijing may retaliate after Brussels imposed tariffs on Chinese-made electric vehicles. Of the 5,000 product groups the People’s Republic imports from the EU, many are too crucial or too small to bother with. But luxury goods, petrol cars and some foods are plausible targets.

Big Beer’s low-alcohol Plan B has too much froth

9 Jul 2024

Carlsberg, AB InBev and Asahi have set toppy targets for their teetotal products. Health concerns and Gen Z’s aversion to alcohol imply that’s a safe bet. But at $13 bln the market is still puny – and if the likes of Coca-Cola muscle in there will be a smaller barrel to share.

Carlsberg soft-drink deal packs an appealing punch

8 Jul 2024

The $18 bln brewer is scooping up J2O-maker Britvic for $4.2 bln. The Danish buyer’s shares have slumped since deal talks started, but investors’ nervousness is overdone. Expanding into non-alcoholic drinks makes sense, and the returns seem reasonable despite a fizzy deal price.

India’s consumer market is large but demanding

2 Jul 2024

Consumption is not a bright spot in the South Asian country, with growth half the pace of GDP. In this Exchange podcast, former Nestlé India board member Rama Bijapurkar explains why international companies need to stick their elbows out to tap the low-earning masses.

 

Britvic can swerve Carlsberg dilution

21 Jun 2024

The soft drinks maker rebuffed a $4 bln cash deal from the Danish beer giant. Carlsberg wants to boost its no-alcohol business, so may yet return with a more generous offer. But Britvic’s cocktail of geographic expansion and low-sugar drinks means it can also grow on its own.

Tate & Lyle’s sour M&A may have nicer aftertaste

20 Jun 2024

The $3.2 bln food company is paying $1.8 bln for US-based ingredient business CP Kelco. An unappetising-looking return may be one reason why Tate & Lyle shares lurched down. But the deal makes strategic sense, and there may yet be a path to sweeter numbers.

Moderna stock is lone omen of bird flu pandemic

17 Jun 2024

The $56 bln Covid vaccine maker’s stock is up 40% since March after an avian flu outbreak. A new jab might be worth trillions for society. The uncertainty about another pestilence, however, means its value to Moderna is probably less than what investors have already gained.