Tyson Foods Inc., the largest U.S. meat company by sales, on Monday said it took a 5% stake in Beyond Meat, a purveyor of plant-based burger patties that seek to replicate the taste and sizzle of ground beef.
Beyond Meat’s patties are a laboratory-born concoction of pea protein, canola and coconut oils with a similar texture, savory taste and even the grilled sizzle of a beef burger.
Whole Foods Market Inc. this year began stocking them in the meat section of dozens of stores mostly in the mid-Atlantic, positioning that has helped the product sell many times faster than when placed alongside other veggie burgers, according to Seth Goldman, executive chairman of El Segundo, Calif.-based Beyond Meat.
“The branding is important,” said Mr. Goldman, who didn’t disclose the terms of the deal.
Beyond Meat wouldn’t disclose annual sales or revenue figures but Mr. Goldman said it has grown rapidly since introducing its first retail products in 2012, and is now available in over 11,000 U.S. stores.
For Tyson, investing in the startup is another step in broadening the company’s range of products and investments beyond its core business in meat processing.
Tyson said investing in plant-based protein would help the company meet consumer demand for more choice and keep tabs on innovations. In 2014, Tyson bought Ball Park hot dog maker Hillshire Brands Co. for $7.7 billion, boosting Tyson’s effort to sell more branded products.
The effort to keep pace with changing consumer tastes has sometimes paired decades-old meatpacking giants with upstarts that built brands by challenging the food business’ status quo.
Spam-maker Hormel in 2015 paid $775 million to buy Applegate Farms LLC, one of the top suppliers of organic meat to retailers like Whole Foods Market Inc. and Trader Joe’s.
Perdue that year struck a deal to buy the parent of Niman Ranch, a line of meat products focused on beef, pork and eggs raised with “humane and sustainable methods.”
Such partnerships have raised questions about whether newer firms can maintain the integrity of their environmental or nutritional claims after joining with legacy food companies.
Mr. Goldman said the financial backing and industry know-how outweighed such concerns for Beyond Meat.
“We know it’s certainly going to raise eyebrows on all sides,” he said. “We fully recognize vegans who supported our business may not immediately understand why this makes sense but I think the consumer is evolving, the market is evolving and both companies are committed to producing delicious products.”