General Mills grabs another slice of the fast-growing away-from-home pie

By Gill Hyslop contact

- Last updated on GMT

The acquisition of TNT Crust will cement General Mills' position in the fast-growing away-from-home frozen baked goods category. Pic: Eric Savage
The acquisition of TNT Crust will cement General Mills' position in the fast-growing away-from-home frozen baked goods category. Pic: Eric Savage

Related tags: General mills, TNT Crust, Peak Rock Capital, pizza crust, frozen baked goods, better-for-you, Foodservice, QSR, retail channels

The Minnesota-based food giant has entered into a definitive agreement to acquire TNT Crust, a manufacturer of better-for-you frozen pizza crusts.

“This acquisition advances our Accelerate strategy and builds on our strong position in the fast-growing away-from-home frozen baked goods category,”​ said Shawn O’Grady, group president of North America Foodservice, General Mills.

“We have clear competitive advantages in foodservice with our strategic customer partnerships, best-in-class supply chain, and operator-first innovation capabilities.”

In the nine months to 27 February, the Minnesota-based company’s North American foodservice business saw sales rise by 24% from the year earlier to $1.32bn, helped by the sector re-opening after Covid. The unit’s operating profit increased 27% to $175m.

Added O’Grady, “By adding the high-growth TNT Crust business to our frozen baked goods platform, we are adding to our scale in a category that is on trend with consumers and poised for continued rapid growth.”

TNT Crust produces partially baked, self-rising, gluten-free and plant-based pizza crusts that are highly complementary to General Mills’ existing frozen baked goods portfolio. The business – a portfolio company of Peak Rock Capital – has leveraged its differentiated products and strong relationships with key operators to drive double-digit compound annual net sales growth over the past four years, with net sales totalling almost $100m in 2021.

General Mills is buying the Wisconsin-based pizza maker from private equity firm Peak Rock Capital, which had acquired TNT from Tyson Foods before in 2018.

Under the agreement, General Mills is also taking ownership of TNT’s two manufacturing facilities in Green Bay, Wisconsin, and St. Charles, Missouri.

Interesting trend

A spokesperson from Peak Rock Capital told BakeryandSnacks “this acquisition reflects an interesting trend”​ today, with private equity firms taking ‘sometimes forgotten’ brands and building them to a standard where blue chip platforms want to own them.

“Peak Rock did the same for Pretzel’s Inc., which was recently acquired by The Hershey Company.”

The middle-market private investment firm specialises in equity and debt investments in companies in North America and Europe, focused on opportunities where it can support senior management to drive rapid growth and performance improvement. The acquisition of Ziyad the Middle East’s largest retailer – in February was the firm’s 13th​ investment in the F&B space in recent years.

Details of the acquisition have not been disclosed, however, the Pillsbury, Betty Crocker and Cascadian Farm-owner intends to fund it with cash on hand and short-term borrowings. The transaction is expected to close in the first quarter of fiscal 2023, subject to regulatory approval and other closing conditions.

Jones Day is serving as legal adviser to General Mills; with Evercore, Goldman Sachs & Co. LLC and Kirkland & Ellis serving as TNT’s advisers.

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