They are not peanuts.
On Thursday, Kraft Heinz announced that he had agreed to sell his nut business, including the iconic Planters brand, to Hormel Foods for $ 3.35 billion in cash.
At Hormel, Planters is being added to a growing collection of grocery brands, including the peanut butter brand Skippy, which Hormel acquired in 2013, and Justin’s Nutbutter, which it acquired in 2016.
The pandemic was a boon for Kraft Heinz, whose factories worked three shifts three shifts last year to meet the high demand for products like Kraft Macaroni & Cheese. Kraft Heinz reported Thursday that fourth quarter net sales rose 6.2 percent to $ 6.9 billion.
Kraft Heinz said full year net sales rose 4.8 percent to $ 26.18 billion. The company expects flat to positive sales growth for 2021.
Kraft Heinz, the result of a 2015 merger that created one of the largest food companies in the world, battled before the pandemic. Inventory had plummeted and lagged other food companies as sales and profits plummeted, also as consumers began to prefer less processed, healthier foods in recent years.
During the pandemic, consumers who now cooked and consumed more meals at home looked for convenience foods and became passionate about many of the old school brands at Kraft Heinz and other food companies.
Pepsico, a rival of Kraft Heinz, also reported a jump in earnings in the fourth quarter on Thursday. The snack giant’s sales rose 8.8 percent from the same period last year to $ 22.46 billion, fueled by consumers who chewed on Cheetos and Doritos during the pandemic.
For Kraft Heinz, the food boom was a good opportunity to lose business. Last September, the company sold its natural cheese business to French Groupe Lactalis for $ 3.2 billion.
The nut business, which generated net sales of around $ 1.1 billion for Kraft Heinz last year, had been neglected within the company and lost market share to competitors, including private label.
As an insult to injury, the company was killed for a Super Bowl ad last year and buried for its monocle mascot, Mr. Peanut, which was founded in 1916 when a student, Antonio Gentile, submitted a sketch to compete for win the brand. At a funeral attended by other brand avatars like the Kool-Aid Man, a small peanut popped out of the ground and squeaked like a dolphin before announcing, “Just kidding. I’m back.”