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Well, that didn’t take long. Just a couple of weeks into the new year, we have our first pet food acquisition, with WellPet announcing on January 8 that it is buying Sojos, a pioneer in the now fast-growing freeze-dried raw pet food category.
As part of the category’s surge, Sojos has been growing, too. Family owned to this point, the company does not divulge financial information (and WellPet has not released terms of the acquisition deal), but in an April 2015 Petfood Industry profile, Ward Johnson, then co-owner, said Sojos sales have increased more than 30% each year, with no signs of slowing down.
Perhaps Ward and his fellow co-owner, wife Maggie, simply could not keep up with the growth without external investment. Or, to reach the next level of growth—including possibly global expansion, which Sojos hints at wanting to pursue in comments on its Facebook page—maybe the smaller company needed a larger parent. And WellPet was the 10th largest pet food company in the world at the end of 2013, according to our Top Pet Food Companies Database. (Note that we will be updating the database with 2015 information and data that will be published in May.)
As for WellPet, the acquisition may be a strategic way to move deeper into a hot growth area. The company seems to have tested those waters with the launch of its TruFood brand last year, which includes Baked Blends (slow-baked dry diets with whole prey and raw produce) and freeze-dried Raw Goodness Treats. (I have a call in to contacts at WellPet and am hoping to gain more insights on the reasons behind the acquisition soon.)
How will current and potential Sojos customers react? While there were not nearly as many comments on Sojos’ Facebook page regarding the acquisition as there were to recent mergers (for example, when Nestlé Purina PetCare bought Merrick Pet Care last year), the reaction was mostly negative, with some people commenting they would no longer feed Sojos to their pets or would stop feeding it at any sign of a change in their pets. Sojos staff gamely tried to respond positively to the first several concerns, then apparently gave up. This follows the pattern seen with the Purina-Merrick deal and others.
One comment seems to sum up both this angst on the part of some consumers as well as, perhaps ironically, the business reasons for companies like WellPet and Sojos to pursue such deals: “Sometimes we all wish it would stop being about getting bigger … And staying special instead.” It remains to seen whether Sojos can continue to operate independently of its new parent and indeed stay special while also continuing to grow.