With the end of the year drawing near, I’ve picked ten of the biggest stories featured during 2015 on FoodBev.com – from Anheuser-Busch’s $106bn takeover of SABMiller to a flurry of innovations in the mix-your-own space. There’s bound to be just as much innovation and surprise moves in 2016, and FoodBev will be right here to bring them to you first.
USA becomes Brew-S-A for BrewDog
When craft brewer BrewDog announced the details of its first American production plant in June, it represented the company’s first foray into the North American market. The company said that it would invest more than $30m in the construction of a 100,000 square foot facility in Canal Winchester, a suburb of Columbus, Ohio. The plant will initially serve the US market with potential to export to other countries later, with 85,000 barrels of beer being brewed at the site in the first year alone.
Two months earlier, the Scottish beer maker had launched a £25m crowdfunding scheme called Equity for Punks, and outlined in the prospectus to investors how it would spend £3m on establishing an American operation.
“Our international expansion plans have always been ambitious, but our intentions stateside are probably up there with some of the most ambitious, bombastic, exciting ventures we’ve ever embarked upon,” BrewDog co-founder James Watt declared.
Ball acquires can maker Rexam
There were three really significant mergers in the food and drinks industry over the past year, attracting a combined sale price of more than $150bn. The first, announced in February, was Ball Corporation’s $6.6bn acquisition of rival can maker Rexam. With necessary clearances expected in the first half of next year, a combined company would have revenues of approximately $15bn – and control around 70% of the European beverage can market, plus about 60% of the North American market.
In November, FoodBev reported that the US company was prepared to sell 11 of its European plants to ease the deal through, and it’s not the only piece of activity from busy Ball in 2015: the manufacturer made moves for the remaining shares in its Latapack-Ball joint venture and acquired two metal food can closure facilities from Sonoco.
Heinz and Kraft Foods merge
In March, it was reported that H. J. Heinz and Kraft Foods had agreed to merge in a deal that would form the fifth largest food and beverage company in the world. With a sale price as high as $40bn, it was – by a long way – the largest deal between two food producers in 2015. Responding to the deal, Frost & Sullivan’s Tosin Jack said that the merger would put the two companies in “good stead” and was not a particularly surprising move, given the increasingly competitive nature of the industry.
The newly merged company, Kraft Heinz, celebrated the deal by voluntarily recalling 36,000 cases of cheese singles after it was found that their film packaging presented an increased risk of choking to consumers.
Anheuser-Busch takes over SABMiller
The year’s biggest acquisition was Anheuser-Busch’s bid to take over SABMiller in October and form the world’s largest brewing group. Still awaiting completion, the merger will result in a combined business that controls close to one third of global beer supply. At $106bn, the sale price is high enough to rival the economic output of a small country – in fact, it beats the GDP of almost two thirds of the world’s economies and is roughly comparable with that of Morocco and Ecuador.
In November, reports suggested that SABMiller was prepared to sell beer brands Peroni and Grolsch in order to appease European anti-trust regulators and strip back its premium brand portfolio ahead of a potential deal.
Other big-money acquisitions this year include the $31bn merger between Coca-Cola Enterprises, Coca-Cola and Coca-Cola Iberian Partners; Saint-Gobain’s €2.95bn sale of its glass packaging division, Verallia; and $2.15bn for Owens-Illinois’ takeover of Vitro.
China invests in New Zealand dairy
The year’s investment in New Zealand’s infant formula production market reflects the continuing lack of confidence among Chinese consumers in domestically produced infant formula milk. In October, Yashili opened a 50,000-ton plant near Auckland, after Hong Kong-based investors revealed plans for a $50m dairy production facility on New Zealand’s North Island. This was followed by a unique solution to the region’s seismic woes from Fonterra, which opened a whole milk drying plant near Palmerston North capable of withstanding an earthquake.
World Beverage Innovation Awards revealed
The winners and finalists of the World Beverage Innovation Awards were announced at a special ceremony at BrauBeviale, Germany, in November. Winners included KHS Group, Husky and Heineken, with PepsiCo and Tetra Pak both taking multiple accolades.
“The pace of innovation in the global beverage industry continues to impress and is reflected in the stunning range of entries in this year’s awards,” said FoodBev Media’s Bill Bruce. PepsiCo’s four awards at the ceremony shows that the company “knows what to do to be successful,” added Robert Sadjak.
Coca-Cola’s unified brand offering…
In March, Coca-Cola introduced a single brand across its entire product portfolio that would help it to distinguish between its four key variants: Coca-Cola, Coca-Cola Life, Coca-Cola Zero and Diet Coke. The move had been prompted by research that showed one in two consumers were unaware that Coca-Cola Zero was the company’s sugar-free, no calorie alternative, with many struggling to identify the difference between the four products.
While we’re looking back at the year, it would be wrong not to include at least one seasonal innovation. Coca-Cola released a novel new label design on its 1.75 litre bottles this Christmas that, when peeled, pulled the label into the shape of a bow.
…and first 100% plant-based bottle
It was this year that Coca-Cola announced that it had developed a fully recyclable PET bottle made entirely from renewable plant-based materials for the first time. The PlantBottle had previously been sourced only partially from plant-based materials but advancements had meant that the proportion of plant-based components could be increased without having a negative impact on the bottle’s opacity.
On the topic of plant-based packaging, in the same week we brought you the news that a US innovator had developed a cup with native seeds embedded in the lining of the cup, which could be planted and grown into a tree after its useful life. Alex Henige spoke to Claire Phoenix about the cup’s biodegradability and which types of seeds have been incorporated into the eco cup.
Innovations in mix-your-own
Let’s not leave Pepsi out, either: they’ve released a number of innovations this year, not least among which is the new Drinkfinity device. The “personal and portable hydration system” utilises a reusable bottle, which is used in conjunction with flavoured pods and first made available in the Brazilian market for a retail price of $34.
PepsiCo’s Hernan Marina spoke exclusively with FoodBev in February about the device, which he called “innovative in terms of the consumer proposition, but also in some of the things we are delivering in in sustainability”.
It joins a raft of innovations in the mix-your-own and home carbonation spaces during the last year. Perhaps equally as big as Pepsi’s Drinkfinity was the Keurig Kold machine launched in September, which gives consumers “the freedom to make all your favourite drinks like never before: always perfectly chilled – with no CO2 canisters – all at the touch of a button”.
The pursuit of dispensing options that don’t require a CO2 canister is one of the main drivers of innovation in the sector: while we were reporting on Keurig Kold, we didn’t miss the Bonne O home carbonation system in Canada that had pipped Keurig to market with its CO2-free solution. In April, Bill Bruce spoke to Bonne O’s Darren Hatherall about the development of the machine.
We really do have our pick of innovations in this marketplace, but among the best of the rest was Lavít, which launched a single-serve cold beverage dispenser in the US in October. The combination of a Lavít capsule and the company’s countertop water and beverage dispenser produces a still or sparkling beverage with ten calories or fewer in each serve – and is bound to make water more interesting to those consumers who should be drinking more.
No love lost between McDonald’s and Burger King
In a year when Pizza Hut launched a pizza box that turns into a makeshift movie projector and McDonald’s debuted a carrying carton for bicycles, the industry was hung up on Burger King’s offer to settle its differences with fierce foe McDonald’s. The fast food retailer wanted to join forces half way between their respective headquarters – in Atlanta, Georgia – to celebrate World Peace Day in style by combining the best of their signature burgers.
The McWhopper would offer the opportunity to “create something special,” Burger King said in an open statement. But fast food fans were left disappointed when McDonald’s CEO Steve Easterbrook posted a firm – almost passive aggressive – response on the company’s Facebook page. “Inspiration for a good cause… great idea,” Easterbrook wrote, before declining Burger King’s offer. “P.S. A simple phone call will do next time.”
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