Forbes - Markets
JNJ's Splenda Sale Shouldn't Be A Concern For Investors
Johnson & Johnson has agreed to sell its iconic sweetener product SPLENDA to Heartland Food Products Group. The terms of the deal have not been disclosed yet, but it is not hard to see why the company may no longer be interested in this business. First, Splenda sweetener is part of Johnson & Johnson’s consumer products segment which has operated on very low margins as compared to pharmaceuticals or medical devices businesses. Second, Splenda’s and other sucralose products’ prices are likely to suffer going forward due to weakness in carbonated drinks market globally. Thus, it makes little sense for the company to continue in this business, especially when there are bigger and more promising opportunities on the pharma side.
No comments:
Post a Comment