Kraft and Heinz are potential buyers for Mead Johnson, industry bankers say

Kraft Foods and Heinz are likely to consider bidding for Bristol Myers’ Mead Johnson business, three industry bankers told mergermarket.

Bristol Myers revealed last week that it is reviewing alternatives for its ConvaTec and Mead Johnson businesses.

In general, food companies are keen on major infant feeding brands, said two of the three bankers.

Heinz’s European baby food business Plasmon has long been thought to be a divestiture candidate because the company has no complementary US business. The company has long been keen to acquire a US infant food business, said two of the three bankers.

Heinz competed with Nestle for Gerber foods, when it was divested by Novartis, according to a previous report by this news service. Even if it were to sell Plasmon, one of the bankers said, Heinz would still likely be interested in a North American baby food business like Mead Johnson.

Nestle, which acquired Gerber for USD 5.5bn in April, is unlikely to go after Mead Johnson, said one of the bankers.

Both Kraft and Heinz would be interested in the Mead Johnson unit because baby formula and infant feeding brands are much more stable than many other food categories and command a much higher level of brand loyalty than other products the two companies own.

Mead Johnson’s Enfamil and Abbott Laboratories’ Similac are the top two formula brands in the US.

A spokesperson from Kraft declined comment. Heinz did not call back.


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