Breaking News on Confectionery & Biscuit Processing

Big Brands > Mars

Sterling fluctuation caused by Brexit is partly to blame

US unit of Hershey, Mars and Nestlé’s cocoa supplier, Transmar, files for bankruptcy

Post a comment
Douglas Yu

By Douglas Yu+

Last updated on 06-Jan-2017 at 13:13 GMT2017-01-06T13:13:51Z

Transmar has expanded rapidly over the past few years, with over 350 commercial customers around the world. Pic: ©iStock/iacona
Transmar has expanded rapidly over the past few years, with over 350 commercial customers around the world. Pic: ©iStock/iacona

The US unit of cocoa trading and supplying company Transmar Group has filed for bankruptcy protection in the US Bankruptcy Court for the Southern District of New York after the parent company experienced insolvency in Europe. 

The group’s US subsidiary, called Transmar Commodity, expanded rapidly during the past few years to create a global supply chain for cocoa and cocoa products, according to the court filing.

Transmar Commodity intends to operate its business throughout the proceedings, said the company’s chief restructuring officer, Robert Frezza.

Despite the quick global expansion, Frezza explained that Transmar Commodity and its affiliates “faced obstacles and difficulties in expanding their infrastructure and corporate governance to integrate its activities into a single network.”

Overreliance on indebted Euromar

In addition, over the past two years, Transmar Commodity and its affiliates, including the group’s other subsidiary Euromar, encountered difficulties in properly hedging their purchasing commitments for cocoa and cocoa products due to the volatility of pricing within the cocoa market and the inherent risks associated with hedging and trading, Frezza said.

Given the fact that cocoa materials are traditionally traded in pound sterling, Brexit - which later caused currency fluctuations - had “significant negative impact on the liquidity of Euromar,” he added.

As Euromar entered liquidity crisis in August, 2016, its newly-appointed co-managing director, Josef Schultheis, demanded Transmar Commodity provided increased financial support, according to the court filing.

“Euromar’s insolvency has also substantially added to the debtor’s (Transmar Commodity) own financial distress,” Frezza said. 

Transmar Commodity is currently "a very large" creditor of Euromar, having net claims against Euromar for at least $94m, Frezza pointed out.

Transmar has over 350 commercial customers around the world, and supplies all major US and European chocolate producers, including Hershey, Mars, Nestlé and Barry Callebaut.

Post a comment

Comment title *
Your comment *
Your name *
Your email *

We will not publish your email on the site

I agree to Terms and Conditions

These comments have not been moderated. You are encouraged to participate with comments that are relevant to our news stories. You should not post comments that are abusive, threatening, defamatory, misleading or invasive of privacy. For the full terms and conditions for commenting see clause 7 of our Terms and Conditions ‘Participating in Online Communities’. These terms may be updated from time to time, so please read them before posting a comment. Any comment that violates these terms may be removed in its entirety as we do not edit comments. If you wish to complain about a comment please use the "REPORT ABUSE" button or contact the editors.

Related products

Related suppliers

Key Industry Events


Access all events listing

Our events, Shows & Conferences...