Kraft's pizza gone

"While a divestiture is not a complete shock, we admit to being caught off guard by the nature of this specific transaction," Stifel Nicolaus analyst Christopher Growe wrote in a note to clients this week. "The frozen pizza business was widely regarded as a key growth pillar for Kraft, one of the company's fastest growing businesses in our view and thus likely not the first choice for sale."

What's more, Kraft called its stock "undervalued" in a press statement and added that "its share price is depressed as a consequence of a number of short term factors which it believes will dissipate once the uncertainty surrounding its Offer for Cadbury is resolved."

Kraft mentioned that they believe that their stock values are undervalued and that the stock prices should rise way faster than it is suppose to. But are they themselves the cause of the slow rise?

Apparently, many people out there are now criticising Kraft for its tremendously slow, creeping growth. At this rate, Kraft might lose out even more to Nestle. As far as I am concern, Nestle has been staying at the top for quite some time and that Kraft has no threats towards it for now.

Worst still, it has now sold the DiGiorno pizza to Nestle.

From the way I see it, Kraft has definitely made a huge mistake there. The frozen pizza business has always been one of the fastest growing business for Kraft and that has become more of a staple food for the Americans now; even for the Asians.

It is definitely a clear-cut long term strategy to keep the frozen-pizza business to further propel its growth.

But from the way Kraft sees it, it is more of a short term strategy to keep the business.

However, for Kraft, pizza had more limited global potential than confectionery. "We're looking to focus on products where we can bring global scale," he said, and since the pizzas are frozen, "it would be difficult to leverage globally."

I thought that this is simply hilarious. The reason they provide is simply shallow and pathetic! Just because it's frozen? No way man seriously. It is difficult? I thought nothing is difficult in this world?

Come to think of it, even commodities can be sold worldwide with a high price if you are willing to add much values to it. Everything boils down to values and services at the end of the day, not the product per se. Look at Starbucks coffee, Frito-Lay's chips and Mcdonald's meals.

What kind of nonsense is Kraft trying to give to the public now. Are they trying to bamboozle us just because their stock values are constantly plummeting now? They can fool the naive ones but definitely not the smart ones.

The pizzas can definitely be marketed well globally (albeit frozen) because of its recognition worldwide. It has become the choice for every pizza-lovers, where they simply microwave it and enjoy it with their late night soccers.

Storage facilities now are definitely way better than before so there is no excuse for Kraft to say that it is costly or hard to store the pizzas.

Finally, I will suggest that Nestle make full use of this purchase and kick Kraft far, far away from their current position in the chart. Now that Nestle has acquired the frozen-pizza business, it is time to create a tumultuous new start for the pizza.

It is the new beginning for the frozen pizza, I hope that they will add some values to the commodity product. For instance, they can do a panoply of radical stuff like pairing it up with some other products that they have. For instance, think of

What other stuff do people take when they are eating pizzas,

Where are they eating pizzas?

Do they need tissues when they eat pizzas?

How do you make it easier for people to heat up the pizzas?

How can they not be messy when they consume the pizza?

It is not easy to wash so is it possible to lias with products that aid cleaning or easy disposal such as paper plates?

By integrating all these together, you bring the consuming of pizzas to a whole new level.

Go Go Nestle. I support you now. Kraft is dissapointing.

Credits -cnn, -michaelthemaven, -livetradingnews, -pgteenspace, -intracore, -icelings, -flickr