Kroger Goes Shopping, Nutrabolt's Market Debut and Big Food on Trial

0:05Monica Watrous:Welcome to the CPG Week podcast by BevNet and Nosh. I'm Monica Watrous, here with my co-host, Lukas Southard. If you're enjoying the show, please subscribe on your listening platform of choice. Here is the latest in food and beverage industry news. Kroger has entered into a definitive agreement to acquire regional grocery chain Giant Eagle for$1.65 billion, marking the company's first major acquisition since its proposed mega merger with Albertsons that collapsed in 2024. The proposed transaction with Giant Eagle would expand Kroger's presence across the Midwest and Mid-Atlantic by adding a network of 197 supermarkets and 11 standalone pharmacies.

0:45Monica Watrous:Giant Eagle generates roughly$9 billion in annual sales, according to a press release, and operates stores in northern Ohio, western Pennsylvania, West Virginia, Maryland, and Indiana. For Giant Eagle, the proposed deal represents a significant opportunity to enhance service, improve value for shoppers, and create additional opportunities for employees while continuing to serve customers throughout its markets, according to Bill Artman, the CEO. The deal, expected to be completed sometime in 2027, remains subject to regulatory approval and customary closing conditions. Kroger said it expects some Giant Eagle stores to be divested as part of the regulatory review process.

1:25Monica Watrous:Compared to the proposed Albertsons merger, which would have combined two of the nation's largest supermarket chains, the Giant Eagle acquisition is significantly smaller and primarily focuses on expanding Kroger's footprint in adjacent regional markets. If approved, the acquisition would further strengthen Kroger's position as one of the nation's largest retailers while giving the company a presence in several markets where Giant Eagle has built a loyal customer base. For those of us who consistently look at beverage sales data and listen to quarterly earnings calls, it comes as no surprise that one of the largest privately owned energy drink companies is preparing a public offering.

2:03Reuters broke the news last week that Nutribolt has enlisted JPMorgan, Goldman Sachs, and Bank of America to help it raise potentially$1 billion by going public. While Red Bull is still privately held, Monster and Celsius remain the top two publicly traded energy drink brands. Yet, Nutribolt has amassed a strong business after offering Keurig Dr. Pepper a 30 % stake in the company in 2022. KDP is the strategic distribution partner of Nutribolt's C4 Energy Drinkline and Bloom, which Nutribolt acquired with a majority investment last September. According to Sakana's sales data through May 12th, C4 sales rose 6.6 % year-over-year to just over $848 million, while Bloom energy drink sales have shot up dramatically 600 % to$423 million during the same period.

3:01What this means long term for the Austin-based energy drink company remains to be seen. But looking at the other two giants in the energy drink space, both Monster and Celsius have carved out bigger slices of the pie by acquiring distressed assets. For Monster, it acquired Bang. And in the case of Celsius, it took Rockstar off the hands of distribution partner PepsiCo. Celsius has also shown that sometimes you got to spend money to make money when it came to acquiring complementary brand Alani Nu. As already stated, Nutribolt is no stranger to snapping up competitor energy brands as it did with Bloom.

3:40And a potential war chest amassed from a public offering could make more consolidation in the energy category more likely.

3:49Monica Watrous:From energy drinks to edamame snacks, The Only Bean is facing a proposed class action lawsuit alleging the dry roasted edamame snacks producer misled consumers by overstating the usable protein content of its products and failing to comply with federal labeling requirements. Filed July 1st in the U.S. District Court for the Northern District of California, the complaint argues that The Only Bean markets its snacks as a high-protein super snack with 11 grams of protein, while omitting a required disclosure showing the percentage of digestible protein available to the body. The lawsuit contends that because the protein is derived from soy, consumers absorb less than the full 11 grams advertised.

4:31Monica Watrous:And the FDA regulations require manufacturers making front-of-pack protein claims to disclose a corrected protein daily value in the Nutrition Facts panel using the Protein Digestibility Corrected Amino Acid Score, or PD-CAS, methodology. According to the complaint, soy protein has a PD-CAS of approximately 0.856, meaning a product marketed as containing 11 grams of protein would provide about 9.4 grams of digestible protein. The plaintiff alleges the only bean failed to include the required percent daily value disclosure, making both its front-of-pack claims and nutrition facts labeling misleading under federal and California law.

5:12Monica Watrous:Brian Lai, founder and CEO of The Only Bean, commented on the complaint in an email to Nosh, noting that the grams the brand claims are lab-tested and accurate. The lawsuit comes just weeks after The Only Bean announced one of its biggest retail wins to date. In June, the company entered all 1 ,968 Target stores nationwide. A milestone lie described Nosh as the culmination of a five-year effort to land the retailer and an opportunity to bring new energy to the traditionally stagnant nuts and trail mix set. The Las Vegas-based brand has rapidly expanded into thousands of stores across the club and grocery channel since its debut six years ago.

5:53Monica Watrous:Better for you ingredients can help a product stand out, but turning those ingredients into a business that grows is the harder part. Join Nonbase for a free webinar on July 28th with Tom First, founder of Culture Pop, and Heather Wood, SVP of Marketing at Goodles. They'll talk about what it really takes to build clean label brands that drive trial, repeat purchase, and sustainable growth, from formulation and sourcing to branding, retail, and operations. Sign up for free at nonbase.com slash podcast. Mark your calendar. Nosh Live is back December 3rd and 4th in Los

6:37In other legal news, a U.S. district court in Pennsylvania has delivered a blow to the movement against ultra-processed foods. The Eastern District Pennsylvania court dismissed a lawsuit targeting 11 major food and beverage manufacturers this week. In the case, 20-year-old plaintiff Bryce Martinez, who was diagnosed with diabetes and non-alcoholic fatty liver disease when he was 16, claimed that major CPG giants contributed to his illnesses by producing, quote, unreasonably dangerous food products and failing to warn customers of known risks associated with UPFs, or ultra-processed foods. The case targeted most major food conglomerates in the U.S., including the Kraft Heinz Company, Mondelez International, Post Holdings, the Coca-Cola Company, PepsiCo, General Mills, Nestle USA, Kelanova, WK Kellogg Company, Mars, and ConAgra Brands.

7:39Martinez listed 179 different products he had consumed since childhood that he believes contributed to his illnesses, including Kraft American Cheese Singles, Oscar Mayer Bologna, Capri Sun, Philadelphia Original Cream Cheese Spread, and Honey Bunches of Oats Cereal. The court's dismissal did concede that there might be a correlation between UPFs and pediatric illnesses, yet there is not enough evidence to prove causation. This all comes as Maha advocates both within the federal government and interest groups outside of the capital have lobbied for more oversight and restrictions on how food is produced.

8:22Last year, the FDA recognized research linking UPFs to cardiovascular disease, type 2 diabetes, and obesity, and has been in the process of working with the U.S. Department of Agriculture to create a uniform definition for UPFs.

8:37Monica Watrous:It's a big win for big food. Yeah, Yeah, I'm actually just impressed that he was able to chronicle 179 different products that he consumed. I don't know if I could name 179 things that I ate. I feel like he might have fudged that list a little bit. I don't know. I'm sure I've eaten everything that he said he ate. And I don't have those illnesses. I feel like we will be seeing other lawsuits of this nature as ultra processed foods continues to remain a hotly debated topic, as well as an undefined category that is pervasive in the American diet. Here are some other notable bits of news from the week.

9:18Monica Watrous:Refresh Gum is making one of its biggest moves yet, entering new categories and rolling out revamped packaging across its entire portfolio to accelerate growth in the mainstream market. So Good So You is ushering in a new chapter of growth, appointing consumer products veteran Jennifer Jorgensen as chief executive roughly three months after the company was acquired by Bonsk Group. And finally, Swedish food and beverage company Vitamin Well Group, parent company of the Bear Bells protein bar brand, has merged with a Waterland private equity-owned Belgian nutritional bar manufacturer. For these stories and more, become an insider at BevNet and Nosh.

9:57Monica Watrous:That wraps up this edition of CPG Week by BevNet and Nosh. Thank you to our audio engineer, Joshua Pratt. Our director is Mike Schneider and our designer is Aaron Willett. If you enjoyed the podcast, please subscribe on your listening platform of choice and we will see you next time.