The Food Institute in the News

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Food Industry M&A's Up 30% In First Half

Contact: Henry Mollman
201 791-5570, ext. 215

UPPER SADDLE RIVER, NJ (July 23, 2010) - Following a relatively quiet year for mergers and acquisitions in 2009, the first half of 2010 demonstrated a marked uptick in deals across many segments in the food industry. The Food Institute published its merger and acquisition analysis through the first half of 2010, reporting a 29.9% increase in mergers over the previous year. Investment capital flowed a little more liberally, demonstrated by the 20% increase in mergers among investment firms and banks in the first half of 2010. (Click here for table http://www.foodinstitute.com/fi6mos.pdf) Venturing into numerous segments in the food industry, private investment flooded into restaurants such as the iconic CKE Restaurants, Inc. as well as rapidly expanding upstarts like Wingstop Restaurants, Inc. Additionally, the 165-year-old Pabst Brewing Company changed hands from the charitable foundation parent of The S&P Company to Metropoulos & Co. and chief investor C. Dean Metropoulos for about $250 million. The deal placed the value and cache of the brand in Mr. Metropoulos' experienced hands, generating interest in the press due to the investor's history of reviving major food brands such as Vlasic Pickles and Chef Boyardee.

Elsewhere in the industry, activity among food processors grew at a modest rate with the biggest increases occurring in the multi-product, snack food and fruit and vegetable processors. Kraft Foods acquisition of Cadbury PLC captured the attention of the mainstream media across the Atlantic, but the finer stipulations of the deal, including Kraft's required divestiture of its frozen pizza business to Nestle S.A., were glossed over by many.

Mergers and acquisition activity in the supermarket category remained lively in 2010, doubling the total number of deals in 2009's first half, with many acquisitions following bankruptcy filings and the divestiture of regional assets by larger retailers. The most significant deal of the year was the Tops Friendly Markets' successful bid for Penn Traffic's assets, following the latter's Chapter 11 filing in November 2009. Tops acquired 79 Penn Traffic locations on Jan. 29, and subsequently sold five locations in western Pennsylvania to Giant Eagle, Inc. The thinning pool of distressed supermarkets and grocers makes such blockbuster deals less likely than in the recent past, but opportunities still exist for retailers with capital and the distribution reach to supply stores in new markets.

Looking ahead to the second half of 2010, M&A activity almost assuredly will exceed 2009's totals and continue to widen the margin between the years, expects the Food Institute. Anticipation for the remaining year will only be marked by optimism when compared to the previous year's subdued activity, with many economic signifiers indicating growth failing to meet expectations. Discouraging economic expansion has consistently reduced hopes for a large-scale and speedy recovery, however buoyed by hope, as unemployment numbers remain stuck at around 10% and consumers continue to spend at a tempered rate with confidence rebounding slowly and at a lesser rate than predicted.

The Food Institute merger database, updated weekly, provides a comprehensive record of all the notable and marginal M&A activity occurring within the food industry. Deals that change the landscape of the industry as well as those that serve as bellwethers for larger trends are reported, granting a perspective that ranges from the macro to the micro. All of the information is located in one archive on the Food Institute website, and is available to all members. In a business as segmented and diverse as the food industry, novice investors and veteran dealmakers alike can take advantage of the resources offered by The Food Institute.

Food Institute hosts webinar entitled "The Future of Food Retailing - 2010"

UPPER SADDLE RIVER, NJ (June 8, 2010) -The Food Institute will partner with Willard Bishop to host a webinar entitled The Future of Food Retailing - 2010. This informative review will be held on Tuesday, June 29, 2010 at 12pm EST.

Food retailers are facing issues that leave many unanswered questions in today's economic environment. This webinar will address many queries concerning consumer-shopping behavior, such as when, and if, consumers will be buying more store brands as the economy improves. What is happening with food prices and what can retailers do to capitalize on current trends? And, what opportunities exist for grocery retailers with the abundance of empty storefronts?

The information gathered in this webinar will provide retailers with a solid way to explore opportunities in 2010 and beyond. The panel will investigate Walmart's Marketside exiting the market and uncovering the consequences, intended and unintended, of their actions. As the end of the current economic recession appears to be on the horizon, this webinar will provide critical information on the future of the food-retailing landscape.

A knowledgeable panel has been assembled which includes Jim Hertel and Craig Rosenblum, both of Willard Bishop, who will provide their unique and unparalleled insights into the Future of Food Retailing. Mr. Hertel sums it up best when he states "These have been turbulent times for food retailers. Most, but not all, have made it through and they wonder "now what?" Will shoppers return to buying premium products or has "value-seeking" become part of their DNA?" The panel will dig into retailer strategies, identify specific actions that retailers are taking and point out the winners and losers in today's ever-changing market. Michael Sansolo, the webinar moderator, has an excellent perspective of today's diverse shopper and how their habits impact the food industry.

This meeting is designed for food and beverage retailers, but should also appeal to manufacturers, restaurants, suppliers, distributors, consultants to the industry and the trade press. A copy of the report will be available to all participants. Sign up for this webinar at http://www.foodinstitute.com/retailfuture2010.cfm

Cracking The Code For "Eating In" To Be Topic Of New Webinar

ELMWOOD PARK, NJ (March 8, 2010) - The combination of food inflation and the recession has had predictable and well-documented consequences, such as growth in private label shares. However, some retailers, notably Wal-Mart, appear to be leveraging the economic down turn as they fundamentally change their shopper value propositions. If successful, these changes will alter supplier relationships as well as the landscape for competitive food retailers, in potentially seismic magnitude and with long-lasting dimensions. A new webinar from The Food Institute will delve into this topic which is detailed extensively in a new study called "Eating In," sponsored by the Coca-Cola Retailing and Research Council - North America.

This study brings together a powerful base of information from The NPD Group, sourced both from its ongoing work, as well as a custom survey done for the Council and this webinar featuring Joe Derochowski, Executive Director The NPD Group, Food and Beverage Services & Bill Bishop Chairman Willard Bishop will explore its findings in depth as well as give answer questions from attendees.

For years food retailers have tried to encourage customers to eat more meals at home, but only a few have "cracked the code." One reason is that up until now, food retailers did not have access to solid information such as this study provides on how customers were thinking about and approaching the planning, preparation, consumption, and even clean-up for meals.

This information gives retailers a solid platform to build a fact-based strategy. It also is translated into literally dozens of fresh insights and actions retailers can take as they focus on making it easier and more beneficial for their customers to eat more meals at home. Speakers will offer remarks focused on turning the new information and insights into action, providing a framework for retailers to use to develop their own strategies. There will also be opportunity for the audience to pose questions to the presenters.

The session is designed for retail executives, but should also be of interest and value to brokers, suppliers, and others with an interest in what will certainly be one of the big topics in food retailing in 2010 and beyond. A copy of the study is available for download when you sign up for the webinar at http://www.foodinstitute.com/eatingin.cfm

Hy-Vee Executive Joins Food Institute Board

ELMWOOD PARK, NJ (Sept. 8, 2009) - Paula Correy, vice president, western region, for Hy-Vee Inc. in West Des Moines, IA, has joined the Board of Trustees of the Food Institute, based here. Ms. Correy, a native of Iowa and long-time retailer, has been with Hy-Vee since 1999. Prior to that she managed department stores in the Midwest.

 Ms. Correy will join twelve other Trustees including Bill Bishop of Willard Bishop, Frank DiPasquale of the National Grocers Association, Mark Allen of the International Foodservice Distributors Association and Michael Sansolo of Sansolo Solutions LLC. Joseph Crocker of Crocker & Associates is current chairman, with Donna George of Schar USA Inc. being the incoming chair. Dean Erstad from Seneca Foods is currently treasurer. Other trustees include Pat Mulhern of Monarch Foods, Win Taylor, Peter Lavoy, and Nancy Glick of MS&L Worldwide.

 "Paula will bring a wealth of needed grocery retailing experience to our Board," says Brian Todd, Food Institute president. "We traditionally have at least one retail trustee, and now we have several. That's important due to all the activity now taking place at the retail level in the food industry. Paula, coming from one of the most progressive supermarket operators in the country, will provide us the high-quality retail input we really need to shape our informational and analytical products and services for the 21^st century. I and all the Trustees warmly welcome her on board."

 Ms. Correy began her career with Hy-Vee as a manager of store operations in unit in Urbandale, IA. She subsequently became store director for the Hy-Vee supermarket in Mankato, MN. In 2002, she was promoted to the position of the chain's director of operations, followed by the appointment to the position of assistant vice president of Hy-Vee's Cherokee division. Her next post was that of vice president of perishables, followed by elevation to vice president marketing. She assumed her present position in 2008.

 She has been elected into the Hy-Vee Hall of Fame and was voted the Department Director of the Year. She currently serves on several committees, including those for information technology, general merchandise, pharmacy and perishables. She has also been on the boards of Midwest Heritage Bank and FDI and is currently a board member of D&D Foods. She lives in the Des Moines area with here husband and three children, Hailey, Tanner and Tye. An avid sports fan, she finds time for running and biking.

About The Food Institute
The Food Institute is the food industry's premiere go-to informational resource. Its products and services include the weekly analytical Food Institute Report, Today In Food daily electronic newsletter, and its website, which provides a broad range of information relative to the food industry including mergers and acquisitions, economic statistics, and a back-article archive. In addition, the Food Institute publishes statistical reviews, including the Food Industry Review, as well as regulatory guides on such issues as food safety, recalls and other subjects. These are produced in conjunction with a prominent Washington law firm, Olsson Frank Weeda Terman Bose Matz PC. The Food Institute also produces webinars and seminars on food issues.

Economic Downturn Presents Opportunities And Challenges: Food Industry Review, 2008

ELMWOOD PARK, NJ (Feb. 18, 2009) - The food industry experienced many changes and upheavals in 2008. Companies have been looking for ways to stay ahead amidst the recession, which is becoming increasingly more difficult. Fortunately there is a go-to resource that caters to the oft overwhelmed professional who needs to stay abreast of the latest trends and news. Key information including demographics, CPI & PPI charts, as well as an overview of the year's mergers and acquisitions are revealed in the just released Food Industry Review publication, a 717-page compendium of important facts and figures that occurred in the food industry during 2008.

The Food Industry Review, 2008 ed., the Food Institute's flagship publication, has arrived to give all those in the industry a helping hand. No other publication offers such a comprehensive look at the food industry--from retail (including grocery stores, c-stores and warehouse clubs) to foodservice (including restaurants and vending). The review also examines consumer trends, new product trends, natural and organic foods, private label and economic trends.

"The Food Industry Review is a comprehensive resource guide to the food industry. It is a must for professionals looking to stay that important step ahead in the current unstable economic climate," noted Corinne Casella, IRC Manager, at the Elmwood Park, NJ-based trade association. Published annually by the Food Institute, Food Industry Review contains easy to read information that encapsulates an entire year and is available for purchase as a whole or by individual chapters.

For more information about Food Industry Review, 2008 or to order the publication, please visit http://www.foodindustryreview.com/buy.cfm.

About The Food Institute
The Food Institute is a nonprofit organization with a single purpose: providing information. The Food Institute strives to be the best "single source" for current, timely and relevant information about the food industry from "farm to fork." The association serves as a trusted source of information, providing balanced coverage of the issues. It delivers information through multiple media so that industry professionals worldwide can tap in when and how they choose. For more information, visit, www.foodinstitute.com.

Could Food Inflation Be Reignited This Year? Overall food prices are projected to rise less than 2008's 5.5% to a bit over 3%, but production cuts and a stronger U.S. dollar could impact.

Elmwood Park, NJ (PRWEB) March 4, 2009 - While food inflation is projected to be under last year's 5.5% level it could be impacted by production cuts and a stronger U.S. dollar, according to Kenneth Zaslow, a senior analyst for BMO Capital Markets speaking at The Food Institute's webinar Where Are Food Prices Headed In 2009? (www.foodinstitute.com/foodprices.cfm) Reductions in production could "reignite inflationary pressures," noted Zaslow, pointing out that the recent slowdown in food inflation has been accelerated by declines in demand, and "trading down" by consumers.

Overall food prices are projected to rise 3% to 4.0%, noted Ephraim Leibtag, U.S. Department of Agriculture economist. Food-at-home prices however are seen rising between 2.5% and 3.5%, while food away-from-home is projected to rise between 3.5% and 4.5%. Center-of-the-plate protein items, such as beef pork and poultry are seen rising under 2008 levels, and dairy and egg prices are actually projected to decline this year after increasing at double-digit rates in 2008.

The Food Institute keeps industry professionals up to date on the latest economic and industry news. Find out about becoming a Food Institute member and joining thousands of other food industry professionals who have been doing so since 1928 at: www.foodinstitute.com.

About The Food Institute The Food Institute is a nonprofit organization with a single purpose: providing information. The Food Institute strives to be the best "single source" for current, timely and relevant information about the food industry from "farm to fork." The association serves as a trusted source of information, providing balanced coverage of the issues. It delivers information through multiple media so that industry professionals worldwide can tap in when and how they choose. For more information, visit www.foodinstitute.com.

Consumers Put Brakes On Food Spending Last Year

ELMWOOD PARK, NJ - (February 2009) - Americans spent an estimated $1.38 trillion on food last year according to the Bureau of Economic Analysis' most recent quarterly report- that's 2.47% less than food spending had been trending in the third quarter of 2008 and the largest quarterly adjustment since the government began tracking such data in 1947 despite soaring food price inflation. "It is safe to say the U.S. shopper reacted to the downturn in the economy more quickly than at any time in recent history and more vociferously than at anytime since immediately World War II when the government began tracking this data," commented Brian Todd, President of The Food Institute.

The behavior of the U.S. consumer changed significantly in the last half of 2008 as prices for food rose at the highest level in almost two decades. While no one can predict the future, The Food Institute will keep its members and the industry overall abreast of economic developments as it has since 1928. The Food Institute will hold a webinar on "What's Ahead For Food Prices," on Feb 24 at 1:00pm EST.

Following two years of accelerated food price inflation, what is the outlook for retail food prices in 2009? As the U.S. and global economies have fallen into a recession and commodity and energy prices have fallen 30% to 60% over the past few months, the food industry faces lower costs, but greater uncertainty.  Both the depth and
breadth of the current recession will have an impact on the food sector and ultimately affect the prices charged by retailers and paid by consumers.  This webinar will focus on the factors that led to the run up in inflation in 2007 and 2008, how these factors have changed over the past few months, and what that means for 2009 and beyond.

The event will feature USDA economist Ephraim Leibtag.  For more go to the Food Institute website at www.foodinstitute.com/foodprices.cfm

What Will The Obama Era Mean For The Food Industry?

Contact: Henry Mollman
201 791-5570, ext. 215

ELMWOOD PARK, NJ (Jan. 26, 2009) - It has only been a week since the inauguration, but changes are already being made by new appointees of President Obama, including USDA Secretary Tom Vilsack who listed child nutrition and improving food safety among his top priorities. Both of the issues and much more was discussed at the recent webinar The Obama Era: What Does It Mean For the Food Industry? Jan. 14, 2009. This event drew scores of attendees who received a look at the current administration and the challenges it will face in the coming years. A recording of the event can be download at www.foodinstitute.com/foodregs2009.cfm

The early hours of the Barack Obama administration proved very eventful, as the President wasted little time in addressing policy established over the previous eight years under the Bush administration. The immediate flurry of activity indicates that the what follows will bring profound and abundant change, and the group assembled by The Food Institute and Washington insider law firm Olsson Frank Weeda Terman Bode Matz P.C. represents the most experienced and insightful professionals yet organized to focus on the ripples that will be felt by the food industry resulting from a sea change in Washington.

With a Democratic White House and a substantial Democratic majority in both houses of Congress, expectations are high for far-reaching legislation with significant repercussions for those in the industry. Former U.S. Congressman Charles Stenholm, known as "Mr. Agriculture" for his well-established experience in Congress on food and agricultural issues and immense knowledge of the business, provides a Washington veteran's familiarity with current representatives and the legislative process. Mr. Stenholm's contributions to the webinar will prove invaluable to anyone involved at any level in the food and agriculture business.

Attorney Marshall L. Matz, recent recipient of the Gene White Lifetime Achievement Award for Child Nutrition, discusses the importance of the reauthorization of the Child Nutrition and WIC Reauthorization Act of 2004, set to expire on Sept. 30, 2009. Mr. Matz describes the many changes likely to be enforced in the reauthorization, particularly in relation to the obesity epidemic, an issue notably placed at the forefront of the new administration's health agenda, as well as the difficulties the reforms will encounter amid the balance of the Economic Stimulus Package and budgetary restraints. This issue will undoubtedly affect any food manufacturer as welfare reform, changes to the school lunch program and an increased importance on childhood nutrition will spill over into innumerable market segments.

The growing influence of consumer and health groups on an activist federal government will assuredly have a considerable impact on future regulations and legislation, and founder and former Chairman of the Food Institute Rick Frank discusses the various groups and representatives that will push for agendas and reforms marginalized by a pro-industry Bush administration. Food safety reform, which was not particularly emphasized over the past eight years, is one of 13 "urgent priorities" as compiled by the U.S. Government Accountability Office. As legislation concerning food safety is highly likely before the end of 2009, leading food industry legislative and regulatory expert Bob Hahn explores the possibilities for FDA reorganization or the creation of an entirely new entity to regulate food safety. With expanded federal authority on food safety issues, food processors and importers will be subject to greater compliance standards and will receive increased scrutiny from regulators.

Other issues discussed in the webinar were:

  I.     Issuance of a report from FDA's Science Advisory Board classifying CFSAN as in a "state of crisis"

 II.     Obesity epidemic continues to worsen, with increasing evidence that consumers not using or not understanding the nutrition label

 III.     States, cities, and counties beginning to enact their own food laws, including bans on trans fat in restaurant foods and nutrition labeling of restaurant foods

 IV.     Rising food prices, with some blaming diversion of grains to ethanol as a contributing factor

 V.     Economic downturn has increased food insecurity and demand for food assistance programs among low-income Americans

 VI.     Perception that FDA under Bush Administration has been "toothless"

A recording of the webinar can be found on the Food Institute website at www.foodinstitute.com/foodregs2009.cfm with more details and commentary.

The Food Institute is the foremost resource for information relative to the food industry and produces e-newsletters, printed analytical reports, guides and statistical reviews of food industry developments.

Olsson Frank Weeda Terman Bode Matz P.C. is a prominent Washington-based law firm that specializes in food legislation and regulation, including food safety, labeling and food importation.

Budget-Conscious Shoppers Buying Less Food

FOOD INSTITUTE PRICE INDICES DOCUMENT "PAINFUL" DECLINING UNIT MOVMENT IN FOOD SALES

ELMWOOD PARK, NJ - (Jan. 26, 2009) - Supermarket and restaurant chains saw their patrons buy less physical product at the end of 2008, year over year, according to the Food Institute's exclusive Prices Indexes. The Food Institute, based here, found that in December alone "deflated" sales at grocery stores fell 4.7%, after allowing for inflation, while eating and drinking places saw their "deflated" sales drop 6.6%. – among the largest declines the Food Institute has recorded since it began tracking this information two decades ago.

 "The impact of higher food prices on both U.S. supermarkets and restaurants is painfully apparent when looking at sales and inflation data from 2008's final quarter," commented Brian Todd, President & CEO of The Food Institute. "While people have to eat, they are opting to do so less often at restaurants, and are carefully traversing supermarket aisles in search of bargains and more economical meal solutions."

Even though there was some slight easing of food-at-home price inflation in the final months of last year, consumers cut back even more sharply on their expenditures at both food stores and restaurants. Operators saw growth in their business plummet to only about 3% in the final quarter as the government's Consumer Price Index for food-at-home hovered above 7%.

Food Inflation last year was at a 19-year high, and, while it is expected to ease somewhat this year, could still top 4%. "Budget conscious consumers, however, will likely be the norm for the foreseeable future, and will continue to look for values," added Todd.

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Would you like to be able to access this kind of information, as well as on other food industry topics 24/7? Become a member of The Food Institute. Go to www.foodinstitute.com and click on "Become A Member" on the menu bar at the top of the page. You will be able to receive the information-packed Food Institute Report, access the FI website with its food industry data bases, get the daily electronic newsletter, Today In Food, and benefit from substantial discounts on FI's webinars, seminars and publications.

Kraft Foods Join the National Grocers Association and Food Institute to Launch Student Learning Service

ELMWOOD PARK, NJ (May 27, 2008) - The Food Institute (FI) and The National Grocers Association (N.G.A.), in cooperation with Kraft Foods, are pleased to announce the launch of the Student Learning Service, a program designed to assist students pursuing a food industry career. The Student Learning Service (SLS) will make important industry information from the Food Institute accessible to the students -- and faculty -- of the member schools of the N.G.A. Food Industry University Coalition (FIUC).

“This is a fantastic program that taps into the Food Institutes vast knowledge and tools to benefit both students and faculty members,” says Richard George, Professor of Food Marketing, St. Joseph’s University, an FIUC member school. Here are some of the benefits the SLS -- executed in alliance with FIUC -- will provide:

Access to food industry data to support student efforts, particularly reports and presentations;
Details on job opportunities;
“Real time” information on developments within the food industry;
and Faculty assistance to develop course work

“Kraft understands the strategic imperative represented by this initiative,” says Denny Belcastro, VP, Customer Development and Industry Relations, Kraft Foods. “In supporting this program, we’re helping to ensure students will acquire the skills and talent essential to be the effective future leaders the food industry needs,“ The Student Learning Service will have several components and – by making the most of web technology – will be designed for ease-of-use. These components include easy access to FI databases/information resources through the FI website (www.foodinstitute.com) and N.G.A. website www.nationalgrocers.org; a career center; a subscription to FI’s “Today in Food Daily Update” e-newsletter and the weekly “FI Report.” Each university’s website also will provide access. Just some of the resources available include: the market information centers, mergers & acquisitions database; archive of back articles, research resources and the food price outlook.

“We believe the Student Learning Service is one of our most important initiatives launched in the last several years,” says Brian Todd, President and CEO of the Food Institute. “The service directly engages the student body of each school with the food industry real-time, and will provide students with the information and background they need to have as future leaders.”

The Student Learning Service also will include a number of new products currently in development, such as: public reports from iLumen Benchmarking Service, Competitive Promotions Report promotional review, a Crisis Management Center and financial reports. In addition, the LearnSomething training programs currently being developed for the Food Institute site would be available for sign-up.

The Student Career Center, aimed directly at the students, will be a tremendous resource. The center will not only provide information about careers after graduation, but also will include details on part-time summer employment and internships. In close association with the N.G.A. Coalition, FI would actively seek participation among all companies in the food industry (major corporations, processors, wholesalers, retailers, etc.) to solicit graduates and students, and would also actively solicit students for posting. This could be an immensely important service, not only for the students, but also -- especially -- for the industry at large, which can certainly benefit from the skills being acquired by tomorrow’s generation at Coalition schools.

“N.G.A. is excited about this new initiative for a number of reasons. One of N.G.A.’s key working agenda items is to recruit the next generation of quality leaders and entrepreneurs, this new program aids us in reaching that goal.” said Frank DiPasquale, Senior Vice President of the National Grocers Association.

The program is expected to launch in August to coincide with the start of the 2008-09 academic year. For more information please contact Christine Cunnick at 703-516-0700.