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Kroger, Impossible Foods partner to create meat substitutes; Beyond Meat shares fall

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Impossible PorkChar Siu Buns were sampled at an Impossible Foods Press Event for CES 2020, held at Mandalay Bay Convention Center in Las Vegas on January 6, 2020.

David Becker | Getty Images News

KrogerAt an investor conference, Impossible Foods announced that they have partnered to develop meat substitutes and other products for their private label company.

The rival of Shares of Impossible Beyond MeatIn afternoon trading, the stock fell 7%. Stock has plunged 68% over the last twelve months, taking its market value to $2.72 trillion.

Robert Moskow, Credit Suisse analyst, wrote to his clients on Friday that Beyond could face a threat from the new partnership.

He wrote that he views the test as a threat against Beyond Meat, because it shows the willingness to co-brand private label products to increase its reach.

Moskow said that the test was similar to Costco’s Kirkland strategy for fresh meat with large producers like Costco. Tyson Foods. These products include Tyson’s or Kirkland’s logos.

This partnership may open up meat options to consumers who are price-sensitive or more. Beyond and Impossible both want to reach price parity with animal-meat, which would attract more customers to try their products. The goal has been made easier by rising prices for meat over the past months.

Kroger already has experimented with private label, plant-based meats. Kroger, the US’s largest supermarket chain, has released a beef substitute under its Simple Truth brand in 2020. Since then, it has released meatless turkey slices and plant-based chicken patties as well as other meat alternatives.

CNBC did not receive a response from Impossible regarding its request for comment.

It is private-held, therefore it does not have to disclose its financial results. However, Reuters reported nearly a year agoIt was reported that the startup would be looking to go public with an initial public sale or special-purpose acquisition company within one year.

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