Campbell Soup Purchases The Popular Rao's Pasta Sauce For Nearly $3 Billion

Campbell's Soup Company expanded its portfolio on Monday with a pricey acquisition. For a cool $2.7 billion, Campbell's purchased Sovos Brands, a food company with three powerhouse lines: Noosa Yoghurt, Michael Angelo's frozen foods, and Rao's Homemade, which includes, among other things, its popular pasta sauces. Though there's a considerable fanbase for each line's products, none are more fervent than Rao's customers. Rao's Homemade has been averaging about 38% market growth each year since 2017 and was well on its way to becoming a billion-dollar brand on its own, according to Forbes

In a press release, Campbell's CEO Mark Clouse announced, "We're thrilled to add the most compelling growth story in the food industry and welcome the talented employees who have built a nearly $1 billion portfolio."  While Sovos is bringing a trio of trusted, well-respected brands to the Campbell's group, the mega-corporation will, in turn, expand the product's reach, introducing Rao's to new markets. The acquisition should be complete by the end of 2023, with any changes to organization and production coming in 2024. Still, with massive expansion comes concerns about losing that quality Rao's flavor.   

What the sale means for Rao's quality

A favorite pasta sauce of Ina Garten and one of the top brands according to a Tasting Table taste test, many are already voicing worries about quality control. On Twitter, Jess. P writes, "They better not touch the recipes and processes of Sovos Brand food. Rao's quality is [in] an entirely different league than Campbell's." Others simply commented, "RIP Rao's." These concerns feel valid when Campbell's other pasta sauce brand, Prego, is considered to suffer from sub-par flavor. A Los Angeles Times red sauce ranking had Rao's as the best and Prego at 30th, as the worst. Campbell's even noted in the release that it doesn't currently have a competitive edge in "the growing ultra-distinctive Italian sauce category." 

Still, Todd Lachman, CEO of Sovos Brands, is more hopeful. Lachman stated in the press release, "As one of the most trusted and respected food companies in North America, I'm confident in Campbell's ability to continue bringing our products to more households and further building on our track record of growth and success for years to come." 

Time will tell what this acquisition holds for this fan-favorite pasta sauce brand, but it's a big move for Campbell's, a company that has been steadily increasing its portfolio to include premium food brands. If they can keep the quality up while expanding the market, it could prove a lucrative investment.