Campbell Soup Company plans to divest its Noosa yogurt business, which it acquired in its recent purchase of Sovos Brands.
In August 2023, Campbell first announced its intent to acquire Sovos, a deal worth $2.7 billion, which was finalized in March of this year. During the announcement, Campbell’s president and CEO Mark Clouse stated that yogurt would not align with their core strategy.
However, Sovos’ other brands, including Rao’s Italian pasta sauces and Michael Angelo’s frozen meals, exceeded expectations.
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Campbell’s Q3 Performance and Sovos Brands Contribution
In Campbell’s Q3 financial report for 2024, they noted a “better-than-anticipated contribution from the Sovos Brands business to our performance.” Reported net sales showed a 6% increase, primarily due to the partial quarter of sales contribution from Sovos Brands.
A decision regarding the Noosa business has been reached; however, Clouse refrained from disclosing specifics about a potential buyer for the brand, disposal date, or financial terms of a prospective deal.
Clouse informed analysts, “One of the most delightful surprises to me has been the robustness of the Noosa business. Despite our initial perception that yogurt might not align with our long-term strategic focus, the resilience, uniqueness, and performance of this business have been remarkable. This success is a testament to the exceptional leadership and management by our dedicated team.”
He further remarked, “The Noosa business remains an outstanding product and brand, consistently delivering strong performance. Remarkably, in the quarter, the Noosa Spoonable business saw a return to dollar growth, propelled by the success of its 8oz yogurt. Moreover, the 8oz yogurt has achieved 14 consecutive quarters of dollar consumption growth.”
“Despite our decision to explore strategic alternatives for the business, given yogurt’s lack of alignment with Campbell’s strategic focus, the performance of the business has surpassed our expectations.”
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