NEW YORK — B&G Foods, Inc. is in search of its next Pirate’s Booty. The Parsippany, N.J.-based maker of Cream of Wheat, Ortega and Mrs. Dash said it would like to acquire another better-for-you snack brand with similar growth potential as Pirate Brands, a maker of baked rice and corn puffs, which the company purchased in 2013 for $195 million.
“We love the Pirate’s Booty brand, and we see a lot of upside to that brand,” said Bob Cantwell, president and chief executive officer, during a June 9 presentation at the Piper Jiffray Consumer Conference in New York. “We would love to find brands that would, we would call, ‘ride along well’ with Pirate’s Booty, kind of a better-for-you snack.
|Bob Cantwell, president and c.e.o. of B&G Foods.|
“Where you will find Pirate’s Booty today is certainly in the Whole Foods of this world and those natural markets. You tend in grocery stores in suburban America to find it in the natural sets. In smaller grocery stores, you might find it in the snack aisles, but usually concentrated with other, better-for-you snacks.
“So if we can find those snacks — and there are brands out there we’d love to own; they have to be willing sellers; we are willing buyers — that would make sense to drop into our snack organization because we now have a street force in those stores. We have a full snack organization managing those businesses. We would love to add into that portfolio. It’s part of what we're looking for today.”
Behind Ortega, Pirate’s Booty is B&G Foods’ second largest brand, reaching $84 million in sales last year. Mr. Cantwell said the company expects the brand to hit up to $150 million in sales over the next three years.
“Huge opportunity on distribution, huge identifiable brand that we can hopefully move into other, better-for-you kids’ categories and really drive volume there,” Mr. Cantwell said.
As a dry grocery business, B&G Foods said it took a while to “get Pirate’s Booty kicked off in our organization.” Now, the business is full steam ahead, Mr. Cantwell said.
“We’ve put a store door sales force in place, kind of a sales activation team, who are in stores putting up displays across this country,” Mr. Cantwell said. “It’s making a huge difference to the Pirate’s Booty franchise.”
The company also has ventured into new categories with the brand, including boxed macaroni and cheese made with organic pasta. The product line is performing well, Mr. Cantwell said, but the company has stopped adding distribution.
“The challenge with that category is you don’t really go up against Kraft mac and cheese; you go up against all the better-for-you mac and cheese, which includes Annie’s and Horizon and all the people who came out,” Mr. Cantwell said. “And everybody is still dealing in that category pretty deeply. So the margins aren’t very strong. That’s why we haven’t tried to expand distribution.”
However, B&G Foods sees other opportunities to extend the Pirate’s Booty name, particularly in children’s snacks.
“The majority who eats Pirate’s Booty are basically kids, kindergarten to 12, 13 years old,” Mr. Cantwell said. “And then when that’s in the household, the other consumer who probably eats more than the kids would be the parents of those kids. But it typically doesn’t get into the household unless you are a parent of kids 12 and under…“We think there's a lot of opportunity of other kids’ snacks to be able to take this brand in a better-for-you concept over the next few years and really move the needle.”