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Diving overview:
- Wonder bread maker Flowers Foods has acquired better snack maker Simple Mills for $795 million. The acquisition of Simple Mills will improve the bread maker’s growth prospects and diversify its portfolio with the addition of crackers, cookies, snack bars and baking mixes.
- Founded in 2012, Simple Mills produces premium, healthy crackers, cookies, snack bars and baking mixes. The company recorded net sales of $240 million in 2024, up 14% from the previous year. The transaction is expected to be completed in the first quarter of 2025.
- Flowers is best known for its breads and sweet treats like Tastykake, but the Georgia-based company has been moving into trendier segments of the food space in recent years.
Dive Insights:
Companies often turn to M&A to accelerate growth and increase exposure to food categories that are rapidly growing in popularity with consumers.
The acquisition of Simple Mills not only helps diversify Flowers’ product mix beyond its bread-heavy portfolio, but also gives it a stronger presence in the snacks category.
Flowers’ current snack portfolio includes Tastykake and Mrs. Freshley’s is leading the way. Simple Mills further enhances the floral presence in the space with crackers, brownies, waffle mixes, bars and baking mixes, but it does so through products using healthier, more recognizable ingredients. For example, Chocolate Brownie Seed & Nut Flour Sweet Thins are made with nutrient-dense watermelon seed meal, cashew meal, sunflower seed meal, and flax, according to the website.
Flowers said the Simple Mills acquisition not only gives the company ownership of an expanded, better-for-you snacking platform that resonates with mainstream consumers, but also provides “significant headroom for future growth.” Flowers said there is room to expand distribution, accelerate innovation, increase speed and reach new segments and categories.
Simple Mills products are available in more than 30,000 natural and conventional stores.
Ryals McMullian, CEO of Flowers Foods, said: “With a leading market position and ample white space for future growth, Simple Mills fits perfectly with our strategy of adding attractive brands in better sectors that complement and diversify our existing portfolio. “He said. name.
Upon completion of the transaction, Simple Mills will operate as an independent subsidiary of Flowers and will continue to be led by Founder and CEO Katlin Smith and her leadership team. Simple Mills will maintain operations in Chicago, Illinois and Mill Valley, California.
Simple Mills’ decision to maintain its existing C-suite can help maintain the innovation and growth that has made the company successful. Flowers may know bread better than anyone, but Smith and her team have proven they know snacks better. After growing from a scrappy startup just over a decade ago to the point where it was acquired for more than three-quarters of a billion dollars by a large food company, Flowers no doubt wants to keep the momentum going.
