US-based food group Hormel Foods has sold its Health Labs business to Paine Schwartz Partners-owned Lyons Magnus for an undisclosed sum.
Following the acquisition, the food and beverages group announced the creation of Lyons Health Labs, which will focus on "nutritional and healthy" products.
Its products will cater to consumers dealing with dysphagia, unintended weight loss, digestive health issues, and hydration needs.
Lyons Health Labs will function as a business unit within Lyons Magnus and will have its headquarters in Fresno, California.
It will integrate the operations and brands from Hormel Health Labs with Lyons Magnus’ existing nutrition and health portfolio.
Hormel Health Labs’ product line features items such as Hormel Vital Cuisine 500 Shakes, MightyShakes Frozen, and Instant Custard Mix.
Lyons Magnus will rebrand several Hormel labels under the new Lyons Health Labs name, including ReadyCare, Thick & Easy, Vital Cuisine, Med Pass 2.0, MightyShakes, and Magic Cup.
Moreover, the Lyons Health Labs business plans to develop new products to meet the nutritional requirements of specific health conditions.
Lyons Magnus CEO Jim Davis said: “We are thrilled to formally launch Lyons Health Labs. With the addition of Hormel Health Labs to our innovative nutrition and health business, we are entering the next phase in our journey to evolve and grow our core businesses.
“The combination of both companies’ broad portfolio of products, resources, capacity, and people immediately establishes Lyons Health Labs as a health and nutrition leader, poised to meet the needs of today’s foodservice operators and also be a major player in tomorrow’s innovations. We are pleased to welcome the Hormel Health Labs team and launch this exciting new venture.”
This strategic move comes after Hormel Foods, known for its Skippy peanut butter, revised its annual net sales forecast in September.
The company reduced its projected net sales for the fiscal year 2024 to between $11.8bn and $12.1bn, down from the previously estimated $12.2bn to $12.5bn.
Hormel Foods attributed this adjustment to “lower commodity prices and production disruptions” at a Virginia facility.
In the third quarter, Hormel Foods reported a 2.2% decrease in net sales to $2.9bn, with retail sales experiencing a 6.6% decline to $1.77bn.
