Mars, the owner of confectionery brands including Snickers, M&M’s and Galaxy is to acquire a minority stake in Kind, the maker of healthy nut bars.
Mexican-American entrepreneur Daniel Lubetzky founded Kind in 2004 to give consumers snacks with ingredients they “can see and pronounce”.
Kind bars are already available in 14 countries worldwide.
The deal values Kind at more than $4bn, according to people with a knowledge of the terms of the transaction, a significant increase from the company’s valuation of $728.5m just three years ago.
Kind has grown at a fast pace, with annual sales hitting more than $700m this year, according to Euromonitor.
The company, headquartered in New York, is now the third-biggest snack bar maker worldwide by market share, behind General Mill’s Nature Valley brand and the Clif Bar line of “wholesome, organic” energy snacks.
Grant Reid, the chief executive of Mars, which makes about $35bn a year in sales, said in a statement:
We believe there is tremendous opportunity to build on the success of KIND’s product portfolio in new markets. As we continue to expand our business and broaden our portfolio to address evolving consumer needs, we’re delighted to partner with a respected leader in the health & wellness space.
Mars, the sixth-largest privately held company in the US, won the bidding war because it put forward the highest valuation and allowed Kind to remain privately held.
Healthy eating trend
Last year, Mars announced plans to remove artificial colors from its food business, which includes Uncle Ben’s Rice and Dolmio, the maker of pasta sauces.
Mars is not alone. Other food giants are increasingly focused on how best to adapt to consumers’ healthier eating habits.
PepsiCo, General Mills and Mondelez International have already looked to diversify away from high-sugar products.
In 2014, General Mills bought the Annie’s brand of organic food, which includes snack bars and popcorn, for about $820m.
Meanwhile Kellogg’s agreed to buy the owner of RX Bars, the protein-bar maker, for $600m last month.
Today, the cereals giant also announced plans to cut the amount of sugar in its three top selling children’s cereals — Coco Pops, Rice Krispies, and Rice Krispies Multi-Grain Shapes — by the middle of next year.