- General Mills has entered into a definitive agreement to acquire TNT Crust, a manufacturer of frozen pizza crusts for regional and national pizza chains, foodservice distributors and retail outlets. TNT Crust is currently owned by private equity firm Peak Rock Capital. Terms of the deal were not disclosed.
- The TNT Crust business has posted double-digit compound annual net sales growth during the past four years, with net sales totaling approximately $100 million in 2021, according to a press release. General Mills said the acquisition builds on its "strong position" in the fast-growing away-from-home frozen baked goods category.
- The purchase by General Mills is the latest in a series of deals being made by food and beverage CPGs to grow sales and increase their presence in popular categories.
While General Mills is best known for cereals like Cocoa Puffs and Wheaties, the Minnesota-based company has been following in the footsteps of other CPGs by repositioning its portfolio for growth. A big part of executing on that strategy has been through acquisitions.
During the past eight years, it has purchased premium meat snacks brand Epic and organic and natural food maker Annie's, and has expanded into pet food with its $8 billion deal for Blue Buffalo.
Its latest deal lifts its presence in away-from-home food consumption, which has been on the rise as COVID-19 restrictions are lifted. General Mills brands such as Cheerios, Bisquick and Gold Medal flour were among the beneficiaries during the pandemic as people stocked their pantries and turned to familiar brand names. TNT could help if sales for General Mills' home-focused brands drop as people continue to venture out.
TNT also gives General Mills a deeper presence in frozen pizza, a growing segment of the food space.
According to Statista, more than 200 million Americans eat frozen pizza, a figure that is more than half the total U.S. population. Despite being a mature market, Statista said last year the global frozen pizza market is expected to grow from about $16.2 billion in 2020 to more than $23 billion dollars by 2027.
In touting the purchase, General Mills highlighted the range of customers for TNT's frozen pizza crusts, including restaurant chains, foodservice distributors and retailers.
“We have clear competitive advantages in Foodservice with our strategic customer partnerships, best-in-class supply chain, and operator-first innovation capabilities," said Shawn O’Grady, General Mills' group president of North America Foodservice. "By adding the high-growth TNT Crust business to our frozen baked goods platform, we are adding to our scale in a category that is on trend with consumers and poised for continued rapid growth.”
General Mills already has a presence in pizza and frozen offerings with Totino's pizza rolls and Pillsbury Pizza Crusts. It also offers items like Pillsbury frozen mini pancakes to schools and flour to pizzerias as part of its foodservice business.
As part of the acquisition, General Mills will acquire two manufacturing facilities in Green Bay, Wisconsin, and one in St. Charles, Missouri — potentially a key part of the deal for the CPG amid ongoing supply chain challenges affecting the broader U.S. economy.
For TNT, the sale marks the latest owner for the 41-year-old company. Meat processing giant Tyson Foods sold it to Peak Rock in 2018.
General Mills is not the only large CPG to turn to M&A to boost its portfolio in growing segments. Late last year, Hershey purchased fast-growing Dot’s Homestyle Pretzels and its Midwest co-manufacturer Pretzels Inc. for $1.2 billion and Coca-Cola spent $5.6 billion to purchase the remaining 85% stake it didn’t own in sports drink maker BodyArmor.