Josh Sosland
An unusual surge of transactions announced over the past two weeks powerfully reveals the two very different faces present in grain-based foods in recent years. Notable in a handful of transactions announced is that nearly all the acquired businesses have had well-publicized struggles to achieve ambitious growth targets, with problems dating back many years in some cases.

For example, Bruegger’s Bagels was once the leading bagel chain in the United States, but the 2011 buyer of the business was unable to enlarge the chain at all (after targeting a 33 per cent expansion by 2015). Similarly, the dramatic rollup of heritage bakery supply businesses in the 1990s that became BakeMark never lived up to its buyer’s hopes. Transactions involving these companies together with Back to Nature Foods Co. (parent of the struggling SnackWell’s brand) and Labriola Bakery underscore grain-based foods’ highly challenging dynamics.

Still, the promise the industry continues to hold is evident in the prominent buyers that have stepped forward for these companies. JAB Holding Co. (the Bruegger’s buyer) has emerged as a powerful force in the industry with its acquisition of Panera Bread Co. and Krispy Kreme Doughnuts, Inc. in the past year. Similarly, J&J Snack Foods, Inc. (the acquirer of Labriola) has a long track record of success with opportunistic acquisitions. How these new owners steer their newly acquired properties in the years ahead promises to be a fascinating story well worth watching.