Mars Inc. is set to purchase Procter & Gamble's petfood brands, including Iams, Eukanuba and Natura, for US$2.9 billion, according to reports. P&G is leaving the pet care market to focus more on its core brands, and the transaction will solidify Mars as the world's biggest petfood company.
Mars did not take on P&G's European business, but it has an option to buy operations in remaining markets in Asia and Africa, said P&G spokesman Paul Fox. The company plans to actively pursue the sale of its European pet care business, he said.
"The announced deal is not a surprise in view of P&G’s declining share," said Paula Flores, head of Euromonitor International's Pet Care division. "P&G is the fourth global player with a global value share 3.6%, down from 4.2% in 2008. Despite the good position in the premium segment of the North American dog and cat food market, where it accounts for 19% of value sales in 2012, this figure stood at 24% as recently as 2008. The company faced two voluntary recalls for its superpremium Natura, Iams and Eukanuba brand during 2013. Moreover P&G has a weak performance in most emerging markets."
The deal is expected to be complete in the second half of the year.
Pet owners want a lot from their pet food brands. They want primary proteins that suit what they believe is best for their animal. They want grains or they don't. They want something customized, but it has to be easy to understand.
Constraints and crises, like those experienced in 2020, help drive innovation and sustainability offers context.