PepsiCo Bares Its Intentions With Its Latest Health Food Acquisition

Billionaire investor Nelson Peltz might not have had healthy snacks in mind five years ago when he recommended that PepsiCo (NASDAQ:PEP) spin off its beverage company. But he may ultimately be right in saying that the soda giant should concentrate on its Frito-Lay division.

PepsiCo's planned acquisition of Bare Foods, a maker of baked fruit and vegetable snacks, shows that even management understands snacks are the path to growth, while soda remains in decline -- though PepsiCo clings to the notion that both are better together than separate.

Consumers continue to be more health conscious in their food choices, and that's driving food companies to make big bets in the space by acquiring makers of healthier snacks.

Last October, Kellogg spent $600 million to buy Chicago Bar Company, the maker of RxBar. Hershey bought the maker of SkinnyPop popcorn, Amplify Snack Brands, in December for $921 million.

Even Campbell Soup moved deeper into snacking with its acquisition of Snyder's-Lance for $6.1 billion.

The purchase of Bare Foods won't be quite so transformative for PepsiCo as was Campbell's acquisition of the pretzel maker (47% of the soup company's annual net sales will now come from snacks).

Read the rest of this story from fool.com...

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