U.S. packaged goods company acquires Glanbia's SlimFast division in America
Unilever, a consumer goods giant, once owned the popular weight loss brand SlimFast, having acquired it for $2.3 billion in 2000. However, in 2018, SlimFast was sold by Unilever to Glanbia for $350 million (€295 million).
Fast forward to 2023, and Glanbia, an Irish nutrition company, has announced plans to offload the underperforming SlimFast brand, seven years after buying it. The decision was made after SlimFast was designated as a "non-core" part of Glanbia's business in February.
The UK is the largest market for SlimFast outside North America, but the brand has been struggling to maintain its popularity. Last year, Glanbia reported a non-cash impairment charge of $91 million relating to falling sales at the SlimFast business unit. A top-to-bottom rebrand in 2022 failed to arrest falling sales.
One of the key reasons for the decline of the SlimFast brand is the increasing warnings from nutritionists about the health implications of replacing wholefoods with highly processed synthetic shakes.
In an effort to focus on more profitable areas, Glanbia also announced the sale of its Body & Fit unit. The financial terms of the deal were not disclosed, but Glanbia valued the US business at €44.1 million at the end of last year.
Heartland Food Products, a US packaged goods group that owns the brand Splenda, has expressed interest in SlimFast. Heartland produces low calorie sweeteners, drink mixes, coffee, and nutritional beverages. The chairman and CEO of Heartland, Ted Gelov, sees potential in both SlimFast and Splenda for "trusted solutions in weight management and sugar reduction".
The sale of SlimFast in the US to Heartland is a significant step for Glanbia, as they aim to streamline their operations and focus on their core business. A process is ongoing for the sale of SlimFast in remaining jurisdictions.
Despite the challenges faced by SlimFast, Glanbia reported a positive financial performance for the first half of the year. Revenue for the period increased by 6% to $1.9 billion. Additionally, Glanbia raised its earnings forecast for the year.
The sale of SlimFast marks a new chapter for both Glanbia and Heartland, and it will be interesting to see how the brand fares under its new ownership.
