Flowers Foods acquires Simple Mills for $795 million in a strategic move to enhance its presence in the natural snack category.

Target Company Overview

Simple Mills, a notable player in the natural snack segment, specializes in gluten-free cookies and crackers. Founded in 2012, the company has successfully carved a significant niche within the shelf-stable baked goods market, demonstrating remarkable growth by more than doubling its retail sales from 2019 to 2022. With a strong presence across multiple categories, Simple Mills has established itself as a leader, boasting annual sales figures of $143 million in natural crackers, $59 million in natural cookies, and $25 million in baking mixes, as indicated by SPINS data.

Industry Overview in the U.S.

The U.S. snack industry continues to evolve, driven by changing consumer preferences towards healthier options and natural ingredients. With a growing demand for gluten-free and health-conscious snacks, brands like Simple Mills have thrived, reinforcing the potential for consolidation within the sector. Over recent years, there has been a notable increase in demand for clean-label products, aligning with consumers' desire for transparency in ingredient sourcing and processing.

Recent trends highlight a resurgence in mergers and acquisitions throughout the food and beverage industry. In the latter half of 2024, several high-profile deals, including Mars' acquisition of Kellanova and PepsiCo's investment in Siete Foo