The upstart trying to displace Heinz ketchup just got bought by one of the world’s biggest food companies

We’re staring down a ketchup war.
We’re staring down a ketchup war.
Image: Reuters/Mike Blake
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A ketchup war is brewing, and the stakes just got higher.

Unilever today announced a deal to acquire New York-based condiments upstart Sir Kensington’s. Bloomberg reported the deal was for around $140 million.

“Ultimately, it allows us a much bigger platform,” Sir Kensington’s co-founder Scott Norton tells Quartz. “When it comes to market access that a partner like Unilever can provide, the fact that they have the ear of every major supermarket in America, as well as major restaurants. We’ll get the benefit of this incredible infrastructure.”

For the Anglo-Dutch food giant, which owns Hellmann’s mayonnaise and many others, the Sir Kensington’s acquisition represents an easy entry point into the market selling premium condiments like ketchups, mustards, dressings, and mayonnaise that consumers are increasingly interested in buying, including a vegan mayo and a posh ketchup—a challenge to the dominance of Kraft Heinz’s ketchup in stores and supermarkets. The deal comes after Unilever rejected Kraft Heinz’s $143 billion bid for it.

Unilever is a category captain in many supermarket chains. That means it gets to draw up and decide how the condiments aisle will look, down to what shelves and placement different brands get to best drive overall sales. With that kind of power, it’s not inconceivable that consumers will start seeing Sir Kensington’s brand products in better positioning to attract shoppers as they wheel their carts down the aisle.

Norton said he and his new bosses at Unilever are committed to phasing and sequencing how quickly the Sir Kensington’s brand grows in the market. There is a clear plan, he says, to ensure the company culture isn’t compromised because of the new infusion of resources. “We’ve always really had this focus on being the early adopter, and building our core,” Norton says. “As good food in America becomes more mainstream, we have proven ourselves.”

Companies such as Sir Kensington’s and Hampton Creek have been trailblazing through the condiment market. Hidden Valley and Wishbone salad dressings—once dominant brands—have ceded market share to premium brands. And Heinz barbecue sauce has been clobbered over the last decade by Sweet Baby Ray’s, which overtook the giant brand in 2010 as the top selling barbecue flavoring.

So it has been done before.

Sir Kensington’s has banked growing consumer interest by using better ingredients. In an interview with Quartz in June 2016, Norton said plainly about Kraft Heinz: “If we’re not on their radars, then they are asleep at the switch.” With Unilever on their side, the company is surely on their radar now.