Mars Bets $36B on Snacks, Tilray Buys Four Beer Brands 🍺

GM and Happy Thursday, folks. Here’s what we’re covering this morning:

• Dry Fly Distillery acquired 🍸

• Alice Mushrooms scores funding 🍄

• Love Corn raises $4M 🌽

• SoWell debuts 💊

• Liquid Death x Van Leeuwen 🍨

Mars Bets $36B on Snacks 🥨

Mars, the global confectionery giant that owns M&M’s, Snickers, Skittles, and KIND, is acquiring snack maker Kellanova for nearly $36B in cash. 

Kellanova, which was spun off from Kellogg in 2023, is home to a number of massive snack brands like Cheez-It, Eggo, RXBAR, Pop-Tarts, Pringles, and Nutri-Grain. Last year, Kellanova generated over $13B in revenue and nearly $1B in net income. 

The deal brings together seventeen $1B brands under one roof and offers Mars greater exposure to the increasingly important snack aisle. Mars currently has some exposure to snacks via brands like Combos, KIND, and Nature’s Bakery, but buying Kellanova gives them a formidable snack division that could eventually rival its petcare division in terms of revenue (around $20B).

One reasonable fear is that antitrust authorities like the FTC could derail the deal. According to consumer advocacy group Food & Water Watch, American consumers would suffer from higher prices and fewer options. Remember when Albertsons and Kroger merged in 2022? Well that deal is still in the limbo despite divesting nearly 600 stores.

I imagine the deal gets done, but Mars and Kellanova will likely have to make some concessions and divest a handful of brands, particularly in the cereal bar category.

More on the transaction here.

Deals 💰

Mergers & Acquisitions 

• Tilray Brands acquired four craft beer brands from Molson Coors. Brands included in the transaction: Hop Valley Brewing Co., Terrapin Beer Co., Revolver Brewing, and Atwater Brewery. Tilray’s craft beer portfolio has been growing fast. Their bev alc sales hit $202M in fiscal 2024 which was up from $95M in fiscal 2023. Reuters

• Spokane-based spirits producer Dry Fly Distillery sold a majority stake to Caymus Vineyards, a Napa Valley-based winery. Dry Fly Distilling was founded 17 years ago and produces a wide variety of spirits and RTD cocktails. BevNET

• Washington-based Ackley Brands acquired Charles Smith Wines for an undisclosed sum. Ackley Brands has been on a buying spree lately. They recently purchased two wine brands from Gallo then acquired Betz Family Winery soon thereafter. Just Drinks

Fundraising

• Alice Mushrooms, a purveyor of functional mushroom chocolates, secured an undisclosed amount of funding led by L Catterton. Additional participants include Zac Efron, Pedro Pascal, and Kevin Hart. Alice Mushrooms launched in 2022 and will announce their first national retail partner in Q4. WWD

• According to an SEC filing, Love Corn secured $4M in equity funding from Melitas Ventures and other undisclosed investors. Love Corn sells crunchy corn snacks and retails at CVS, Kroger, Publix, and Target. SEC

• Per PitchBook, Force of Nature Meats raised $5M in fresh funding from Hamilton Square Investments. Force of Nature was co-founded by Taylor Collins and Katie Forrest who previously founded and sold EPIC Provisions. PitchBook

What’s New 🤩

Apparel, Cosmetics, and Wellness

• Vital Proteins is moving away from plastic by releasing its Collagen Peptides in an 80% paperboard canister. It looks great but I’m curious how it will withstand wear and tear. Packaging Gateway

• SoWell, a new supplement brand that aims to combat the side effects of GLP-1s like Ozempic, launched with three SKUs. The system of fiber, protein, and electrolytes combats side effects like nausea and muscle loss. WWD

• Scalp care brand Act+Acre is launching a new product exclusively at Sephora on August 18th. Instagram

• Victoria’s Secret has hired Hillary Super to be its next CEO. This is their third CEO in four years. Most recently Hillary Super served as the CEO of Savage x Fenty, Rihanna’s lingerie brand. Business of Fashion

• Fragrance brand Diptyque is opening yet another new store in London. The new store will be located in Covent Garden. The Industry

Food, Beverage, and Alcohol

• Huel launched a reformulated version of its energy drink range in the United States. To appeal to U.S. consumers, Huel doubled the caffeine count to 200mg. Each can contains 3g of sugar and only 35 calories. Stack3d

• Liquid Death collaborated with Van Leeuwen Ice Cream on a very limited edition sparkling water flavor — Hot Fudge Sundae. It’s available exclusively on Amazon and at Van Leeuwen scoop shops. Liquid Death

• United Sodas partnered with Center to refresh their branding. The updated branding is a vast improvement. United Sodas also reformulated their products and improved the sweetener base. Instagram

• Popcorn brand G.H. Cretors collaborated with Tajin on a new flavor which is available exclusively at Costco Mexico and Costco Northeast. PR Newswire

• Flow Hydration released four sparkling water SKUs. What’s odd is that Flow’s Tetra Pak SKUs look really good, but their sparkling range just looks bizarre. Business Wire

Data 🖥️

• Starbucks stock surged 21% after the coffee company announced that Brian Niccol, the CEO of Chipotle, is taking over as CEO. Chipotle stock also dipped 8% on the news. Nasdaq

Distribution News 🚚

• Misfits Health launched their protein bars at Ralphs.

• MUSH launched their oatmeal smoothies at Costco.

• BFY soda brand Poppi officially launched in Canada.