The fast-growing pet food market continues to attract traditional processed foods companies, with J.M. Smucker agreeing to acquire Ainsworth Pet Nutrition for about $1.9 billion.
Two-thirds of Ainsworth’s sales come from its Rachael Ray Nutrish brand of premium dog food that generates about two-thirds of its sales.
Smucker said the deal announced Wednesday will “increase the scale and further accelerate the growth profile” of its pet food business, which includes such brands as Nature’s Recipe, Pup-peroni, Meow Mix, and Pounce. It will acquire Ainsworth from private-equity firm L Catterton.
“Ainsworth Pet Nutrition is an excellent strategic fit for our company, as the Rachael Ray Nutrish brand adds another high-growth, on-trend brand to our pet food portfolio,” Smucker CEO Mark Smucker said in a news release.
As Reuters reports, “Smucker’s deal is the latest in a string of acquisitions of pet food companies by traditional processed food makers and comes on the heels of General Mills Inc.’s purchase of high-end pet food maker Blue Buffalo Pet Products Inc. for about $8 billion.”
Mars, Cargill, and Nestle have also recently added pet food companies to their portfolio as they compete for a share of the $30 billion U.S. pet food market. Retail pet food sales rose over three times as fast as sales of packaged foods last year, according to Euromonitor.
“Pet food and pet snacks has become the largest center-of-the-store category in the U.S. food and beverage market,” Smucker said.
The company said Rachael Ray Nutrish would “significantly expand” its presence in the premium dog food segment, complementing Nature’s Recipe. “While Nutrish has a relatively smaller presence in premium cat food, the brand is well-positioned for significant growth in this segment,” it added.
Pennsylvania-based Ainsworth was founded in 1933 and acquired by L Catterton in 2014.
“The J. M. Smucker Company, also a fifth-generation family company, is led by a like-minded family to our own,” Ainsworth Executive Chairman Sean Lang said. “We expect the combined horsepower of these pet care organizations to achieve great things.”