• 🏭 Inside Once Again’s Acquisition
• 📈 Albertsons Reports Q2 Earnings
• 💰 Cerebelly Nets $10.6M Investment 
• 🏭 Voyage's New Manufacturing Plant
• 🤝 Graham Acquires Tulkoff Food Products
• 💰 Even After A $600M Exit, Peter Rahal Isn’t Satisfied. The Truth Is, He May Never Be.

WK Kellogg Co. has been taking heat in recent months from some vocal health food advocates and investors who have called on the cereal maker to remove artificial colorings from its U.S. distributed products.

Yesterday, protesters including public health personalities and Michigan politicians like State Reps. Brad Paquette and Steve Carra and State Senator Jonathan Lindsey gathered at Friendship Park in Battle Creek, Mich., to call for the cereal maker to follow through on its 2015 promise to remove artificial colors like Red 40, Yellow 6 and Blue 1 as well as the preservative BHT from its product formulations.

The campaign began in March when Kellogg’s investor and HumanCo CEO Jason Karp, alongside high-profile attorney Alex Spiro, sent a shareholder activist letter requesting WK Kellogg “reinstate — and immediately deliver on — its commitment to remove artificial dyes from its products.”

Before founding private holding company HumanCo in 2019, which owns better-for-you brands such as Snow Days, Against The Grain, Cosmic Bliss, Grove Collaborative and True Food Kitchen brands, Karp co-founded Hu Products and Hu Kitchen in 2011. Karp had founded hedge fund Tourbillon but shut it down in 2018 to focus on Hu, which he saw as a vehicle to building a healthier food system. Hu Master Holdings was acquired by Mondelēz in January 2021.

The letter was accompanied by an online petition posted by healthy food activist and writer Vani “The Food Babe” Hari that currently has over 435,000 signatures. Karp and Hari appeared at a U.S. Senate hearing in September on American Health and Nutrition where they called out Kellogg’s lack of follow-through on its promises and asked consumers to “vote with their wallets” via a boycott of the Froot Loops maker.

The activists have called for Kellogg’s to use the same or similar formulations it uses in products distributed to Canada, the U.K., the E.U. and Australia. Abroad, Kellogg’s uses vegetable and fruit juices and concentrates to color its cereals due to stricter food additive regulations. In the U.S., artificial colors are used for more vibrant visual appeal despite concerns that these ingredients can increase hyperactivity in children.

California recently banned the use of artificial colors in the state’s public schools, including Red 40 and five other colorings as part of the California School Food Safety Act. BHT (butylated hydroxytoluene) is used as an antioxidizing preservative in foods and has been deemed safe to use by the U.S. National Institutes of Health and the Canadian government, but was restricted for use in the European Union. High-intake of BHT is believed by some to cause cancer.

Kellogg's declined to meet with representatives of yesterday's rally, according to the organizers.

Catch up: WK Kellogg To ‘Modernize’ Legacy Cereal Brand Supply Chains.

Employee-owned nut butter business Once Again added manufacturing muscle and additional ingredients to its portfolio with its latest acquisition, which CEO Bob Gelser believes will help the company remain competitive both as a B2B supplier and standalone CPG brand.

🥜 Once Again announced its acquisition of California-based Big Tree Organics earlier this month and currently produces its five varieties of nut and seed butters at its facility in Western New York. 

📍 That facility is more than 2,700 miles away from where the majority of almonds are grown in California’s Central Valley, so rather than shipping the input across the country, and oftentimes back again for distribution on the West Coast, Once Again established a secondary home base. 

🗣️ What they said: “This is an example where proximity to the commodity that we use is going to be very important to remain competitive in certain situations. Our western New York facility is in a good location relative to our distribution on the East Coast, but as we grow, we're going to have to be strategic about where we locate manufacturing.” - Bob Gelser

Nosh Insiders can access the full story to learn how this acquisition will help Once Again reduce costs and minimize supply chain complexity.

Each year, Nosh recognizes packaged food industry companies, brands, individuals, products, ideas, and trends through our annual Best Of awards show, presented at our two-day Nosh Live conference. This year, the winners will be announced on Dec. 5 in Marina del Rey, Calif.

Nominations are currently open, and you may submit as many nominations as you’d like, either for your own company/product or a company/product you find deserving. 

The deadline to submit nominations is Friday, Nov. 1.

Click here for more information and to submit a nomination.  

Albertsons Companies’ Q2 earnings surpassed analysts’ projections with net sales and other revenue reaching $18.6 billion, up from $18.3 billion last year, fueled by an increase in digital sales and omnichannel shoppers. Here’s the top-level view:

• Loyalty members increased 15% to 43 million, while digital sales climbed 24%. Meanwhile, identical sales grew 2.5%.
• Gross margin rate was flat at 27.6%. Excluding the impact of fuel and LIFO expenses, gross margin rate decreased 44 basis points. 
• Selling and administrative expenses increased to 25.8% of net sales and other revenue compared to 25.1% during Q2 2023. 

⏩ Despite the optimistic tone of the earnings report, Albertsons says it will continue to face several growth challenges in the back half of the fiscal year, including increased competition and uncertainty surrounding its (heavily scrutinized) proposed $24.6 billion merger with Kroger.

💭 “As we look ahead to the balance of fiscal 2024, we expect to see continued headwinds related to investments in associate wages and benefits, an increasing mix of our pharmacy and digital businesses, which carry lower margins, and an increasingly competitive backdrop,” said CEO Vivek Sankaran in a press release. 

Read the full earnings recap on Nosh.

Children’s health food brand Cerebelly has begun raising a new round of growth capital and has already locked in about $10.6 million from both new and existing investors, according to two new SEC filings. 

💸Both filed last Thursday, the notices list Cerebelly CEO Don Clark and are for sums of $3 million and $7.6 million, respectively. The new capital raise is a significant uptick from the brand’s previous oversubscribed Series A that closed at $7 million in March 2023.

🚚 On the back of receiving its brain-health patent, the neurosurgeon-founded, children’s brain health-supporting brand has locked in numerous distribution deals, bringing its store count to over 11,500, including partnerships with Publix and FreshThyme.

Food tech company Voyage Foods announced today it will open a 284,000 sq. ft. manufacturing plant in Mason, Ohio, to produce its cocoa-free chocolate, nut-free spreads and bean-free coffee. The new facility is expected to be operational by the new year.

⏪ Earlier this year, Voyage Foods locked in a major partnership with Cargill where it will serve as the company’s exclusive B2B partner. The new plant will help the food tech company meet the demands of new opportunities within CPG and foodservice. 

👀 Following the completion of the new facility, Voyage Foods will also maintain its headquarters and manufacturing plant in Oakland, Calif. 

💭 “With this new facility, Voyage is maturing from a startup food technology company to a large-scale manufacturer with the ability to deliver value across the entire ecosystem to our people, partners, and the planet,” said Adam Maxwell, CEO and Founder of Voyage Foods, in a statement. 

Private equity firm Graham Partners announced it has acquired Maryland-based food manufacturer Tulkoff Food Products. Financial terms were not disclosed. 

🫙 Tulkoff Food Products serves as a private label producer and co-packer of sauces, dips and dressings for foodservice, retail and industrial ingredient partners across the country. 

👔 Phil Tulkoff, CEO and third-generation owner-operator, will continue to lead the company's management team following the close of the deal. 

🏭 While Philadelphia-based Graham Partners typically focuses investments on tech-driven companies, managing principal Andrew Snyder told PE Hub it was attracted to the company’s innovative spirit and flexible manufacturing capabilities.

In an interview framed as a series of true or false questions, Peter Rahal, the co-founder of protein bar brands RXBAR and David, reflects on his obsessive work ethic and leadership style. He also talks about “the best business strategy” and what he means when he says that happiness is “irrelevant.”

Listen to the episode now.