Kellogg To Scoop Up “Clean-Label” RXBAR Protein Bar Company

Cereal giant Kellogg—known for big brands like Corn Flakes, Frosted Flakes, and Pop Tarts—has just announced plans to buy the fledgling protein-bar company RXBAR for $600 million. This could easily be seen as a wise strategic move to appeal to the younger consumer base in an effort to capture more market share in that demographic.

Sure enough, new Kellogg CEO Steve Cahillane comments, “RXBAR is a unique and innovative company. Adding a pioneering in clean-label, high-protein snacking to our portfolio bolsters our already strong wholesome snacks offering.”

Not only is RXBAR “unique and innovative,” but it is young, too. The brand is led by a firm of Chicago-based millennials with a mind for simple, affordable options. The protein bars simply list, on the label in bold print, the whole food ingredients, and is already projected to do $100 million this year. The company found early success by building a following in gyms before expanding to grocery store chain shelves across the country. In 2014 the company produced 1.5 million bars but this year, the projections are near 120 million.

As such, Cahillane continues, “RXBar is an excellent strategic fit for Kellogg as we pivot to growth. With its strong millennial consumption and diversified channel presence including e-commerce, RXBar is perfectly positioned to perform well against future food trends.”

In this deal, RXBAR CEO and co-founder Peter Rahal says “We’ll remain as a stand-alone business within Kellogg and just leverage the resources to expedite growth and keep doing what we’re doing.”

Rahal, 31, started the company in his parents’ basement in 2013, with his childhood friend Jared Smith. Presently, RXBAR has 75 employees with distribution contracts through Whole Foods, Target, and several other major retail outlets.

Rahal comments, “Our growth is a reflection of the size of the problem we solved with our product. The size of the growth reflects how many people actually wanted a natural protein bar … a brand that was real and upfront.”

He also makes sure to assure, “If you’re a customer of ours, you won’t feel a change. What will change is there will be more places you can get the bars, so more people will eat our products.”

 

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