Post goes independent (again)

Post, one of the original breakfast cereal brands, is once again facing new ownership, the fourth time in 26 years. But, instead of being taken over by another food conglomerate (as it was in the past by General Foods, Kraft, and most recently Ralcorp), Post will become an independent, public company. Ralcorp didn't have success with the brand and has decided to move on.

Post certainly is a well-known company, with some strong brands, but really nothing that has captivated the marketplace. As I've suggested previously, the middle of the cereal market is getting squeezed, and Post is a prime example of such a company struggling to enjoy success. The new company will embark on a new strategy, but organizational and functional changes may not be enough for Post to be the cereal powerhouse it once was.

(Source: stltoday.com)

Take-overs

Things have been relatively quiet in the cereal world, but two reports in the last week or so are changing that.

First, some speculation has emerged that Swiss food giant Nestle is interested in a take-over of General Mills. This is not completely surprising, as the two companies have worked together closely in the past, including the recent launch of a new innovation research center.

And, this week ConAgra has made bids to take over Ralcorp, maker of Post and various private label cereals.

On the surface, this just appears to be nothing more than corporate consolidation. But, it does represent the shifting nature in the food business, with a growing bifurcation between large corporations and small niche ventures. I've been observing this in cereal for quite some time, with large mass-market brands, but with increasing opportunities for smaller, nimbler companies that can target specific consumer needs and tastes.

(Source: Bloomberg)

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