PAG’s acquisition of Pattie Foods and Vesco Foods for an estimated $472 million is set to benefit the savoury snacks market by allowing the entrance of more competitors.
“Apart from expanding PAG’s product portfolio and adding to the existing brands such as Red Rooster, Oporto, and Chicken Treat, and the Cheesecake Shop, the new acquisitions will allow the company to enter into a market with high per capita consumption of snacks,” said Parthasaradhi Reddy, Consumer Analyst at GlobalData.
However, the per capita consumption of savoury snacks is expected to decline from 3.3kg in 2021 to 3.1kg in 2026 in Australia. The overall savoury snack market is expected to be stagnant with a modest CAGR of 0.2 percent during the period.
“The competition in the Australian savoury snacks market is intense, with PepsiCo gaining a huge lead over other companies. The entrenched presence of global multinational companies will force PAG to spend significantly if it has to gain a share.
“PAG’s acquisition of Patties Foods and Vesco Foods might diversify its presence in the consumer food segment in Australia, but it remains to be seen if PAG has the wherewithal and the patience to sustain in a mature market with bleak growth prospects.”
