Tyson Takes 5 Percent Stake in Beyond Meat
11 Oct 2016 --- Tyson Foods, the biggest meat processor in the US by sales, has snapped up a five percent stake in a Los Angeles-based producer of plant-based meat substitutes. Beyond Meat is a company that makes meats from protein sources such as peas and soy.
The investment from Tyson Foods- for an undisclosed amount-indicates that growing appetite of big, traditional food companies to invest in companies providing plant-based products, a fast-growing segment of the food and drinks industry.
According to the Plant Based Foods Association, sales of plant-based foods were $4.9bn in the 12 months to June this year and grew faster than the overall food business.
Beyond Meat was founded by Chief Executive Ethan Brown in 2009 to make plant-based products that replicated meat but attempted to eliminate "some of the downsides" of the meat industry in the process.
Its first product, Chicken-Free Strips, began being sold in Whole Food Markets, which also now sells its Beyond Burger, a protein plant burger cooked on a griddle, in its meat section.
Tyson Foods’ Executive Vice President of Strategy and New Ventures & President of Foodservice, Monica McGurk, added, “We’re enthusiastic about this investment, which gives us exposure to a fast-growing segment of the protein market. It meets our desire to offer consumers choices and to consider how we can serve an ever-growing and diverse global population, while remaining focused on our core prepared foods and animal protein businesses.”
Brown said: “This investment by Tyson Foods underscores the growing market for plant protein. I’m pleased to welcome Tyson as an investor and look forward to leveraging this support to broaden availability of plant protein choices to consumers.”
Other investors in Beyond Meat include The Humane Society of the United States Bill Gates, and General Mills.
The investment from Tyson Foods is just the latest bet on plant-based products.
Earlier this year, Danone acquired plant-based dairy maker WhiteWave Foods for $10.4bn.
In 2014, Pinnacle Foods struck a deal to purchase Canadian plant-based food specialist Garden Protein International for $154m.
As well as looking to tap into the latest consumer habits, Tyson has also looked to ramp up its core meat business by purchasing Hillshire Brands in 2014.
Ethan Brown wrote in a blog regarding the investment: “Today, we take another step toward the broader market as we welcome Tyson Foods to Beyond Meat as a minority investor. The investment provides an opportunity for each party to get to know one another and to explore possible collaborations (Tyson touches 2 of 5 plates in the United States). My willingness to engage with Tyson may unsettle the most ardent supporters of our brand. Tyson will also likely hear disapproval from certain stakeholders, suppliers, and consumers. Yet in both cases, I like to think that our nascent relationship is a hopeful sign. A sign that we may be moving beyond Oprah v. Cattlemen and toward productive collaboration that expands consumer choice.”
“I don't expect to change Tyson. Nor does Tyson expect to change me. Instead, we both intend to serve the changing consumer. On my own beliefs, I want to be clear. I believe that plant-based meats have human health (World Health Organization) and climate benefits(Goodland & Anhang) benefits. These positives issues motivate me, strongly. But I also believe in what is the third rail in polite company: animals value their lives as much as we do ours, and here we have unmet obligations. It would be disingenuous of me to downplay this belief as I entered this new relationship.”
By John Reynolds
