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- Apr 5, 2009
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"The companies are targeting $1.5 billion a year in annual cost savings by the end of 2017..." Looks to me like Heinz/Kraft/Burger King/Anheuser-Busch InBev/etc... are going to be firing a lot of people?
A Mega-Merger Too Far: Kraft Foods-H.J Heinz Announce Merger
Patrick Woodall
Do you like ketchup with your mac and cheese? H.J. Heinz and Kraft sure appear to. This morning, processed food powerhouse Kraft Foods and ketchup kingpin H.J. Heinz announced a merger that will create the nation’s 5th largest food company. The post-merger company would sell $28 billion worth of food annually and control eight brands with sales over $1 billion and five more brands with sales between $500 million and $1 billion.
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Even when mergers do not join companies that sell identical kinds of foods, they give big food processing companies more economic power and leverage over other companies and consumers. New start-up food companies would find it harder to get on grocery store shelves because Kraft would have them surrounded on all sides. And supermarket chains are more likely to work with a conglomerate like Kraft supplying products in many different parts of the store than lots of companies that only supply a few products.
The expanding tentacles of companies like Kraft can limit choices by pushing consumers to buy Kraft brands in multiple grocery categories. For example, the proposed merger would join Kraft’s Grey Poupon mustard and Heinz Ketchup, which make it easier to promote both brands together, increasing the control that just one company has over a bigger piece of that grocery aisle.
<snip>
.
"The companies are targeting $1.5 billion a year in annual cost savings by the end of 2017..." Looks to me like Heinz/Kraft/Burger King/Anheuser-Busch InBev/etc... are going to be firing a lot of people?
A Mega-Merger Too Far: Kraft Foods-H.J Heinz Announce Merger
Patrick Woodall
Do you like ketchup with your mac and cheese? H.J. Heinz and Kraft sure appear to. This morning, processed food powerhouse Kraft Foods and ketchup kingpin H.J. Heinz announced a merger that will create the nation’s 5th largest food company. The post-merger company would sell $28 billion worth of food annually and control eight brands with sales over $1 billion and five more brands with sales between $500 million and $1 billion.
<snip>
Even when mergers do not join companies that sell identical kinds of foods, they give big food processing companies more economic power and leverage over other companies and consumers. New start-up food companies would find it harder to get on grocery store shelves because Kraft would have them surrounded on all sides. And supermarket chains are more likely to work with a conglomerate like Kraft supplying products in many different parts of the store than lots of companies that only supply a few products.
The expanding tentacles of companies like Kraft can limit choices by pushing consumers to buy Kraft brands in multiple grocery categories. For example, the proposed merger would join Kraft’s Grey Poupon mustard and Heinz Ketchup, which make it easier to promote both brands together, increasing the control that just one company has over a bigger piece of that grocery aisle.
<snip>
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