The chief executive of Kraft Heinz, Bernardo Hees, has said that he believes the FMCG sector will see more consolidation, and has suggested that the Heinz ketchup and Planters peanuts maker could be one of the driving forces in that process.
Speaking at the Barclays Global Consumer Staples Conference in Boston, Hees said, "We believe there will be more consolidation in the industry. We want to be of course behind that if we can.
"We like strong brands. We like business that can travel and we like business that can have synergies that we can reinvest behind that."
As to what he meant by seeking brands 'that can travel', Hees said that he was referring to brands that are leaders in categories that don't change, country to country.
"I think Heinz is a good example, I think Kraft is a good example, I think Planters is a good example," he said. "They are the brands that are more local and that's fine, extremely important to the portfolio and important for us.
"But what I mean by brands that can travel, brands that have the awareness and have the potential of doing something bigger than themselves."
Acquisition Mindset
As to whether Kraft Heinz is potentially looking at large or small acquisitions, Hees added that the company is looking at both situations.
"We have done a couple last year in Australia and others. I think when the right time is given and the conditions are here, but two plus two is more than four, we are able to move fast and move certainly."
Buffett's Influence
Hees was also asked about Warren Buffett's recent comments on the slowdown in consolidation in the FMCG sector, with the investor recently saying that he felt it was difficult to offer a premium for a packaged goods company in an overheated market.
"What he said is actually accurate that there is lot of return to be made in those environments, but we need to be disciplined in the way you operate, what you pay for, and what you're going to do after acquiring in the long-term plan," Hees said.
"It's difficult for me to think someone that could be more supportive of everything we're doing."
Buffett recently stepped down from Kraft Heinz' board, however his Berkshire Hathaway operation remains the largest shareholder in the business.
Hees has been the CEO of Kraft Heinz since July 2015.
© 2018 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine.
