Barry Callebaut has completed the purchase of two Nestle units, the company said yesterday.
The transaction involved the takeover of a Nestle chocolate factory in Dijon, France, and the cocoa liquor and liquid chocolate making unit based at Nestle's factory in San Sisto, Italy.
This follows the Zurich-based company's recent expansion deals across other European regions.
The deal also involves a long-term agreement to supply Nestle with 43,000 metric tonnes of chocolate products per year to the company's subsidiaries in France, Italy and Russia.
Barry Callebaut recently signed an agreement with Cadbury's to provide the confectionery giant with a third of its outsourced chocolate needs in Poland, and expects their new Russian factory to open in September.
"The supply agreement with Nestle marks an important step ahead in Barry Callebaut's strategy to be the outsourcing partner of choice for the chocolate industry," Josiane Kremer from the company told ConfectioneryNews.com. "An increasing number of food manufacturers are moving to outsource their chocolate need to specialised players. Barry Callebaut is well positioned to further benefit from a growing trend towards outsourcing in the future."
She added: "This trend is expected to accelerate as more integrated players shift their focus towards sales and marketing and seek to source industrial chocolate from third parties."
The company said the transaction was complete on July 1, although neither Barry Callebaut nor Nestle disclosed any financial details.
Barry Callebaut said the takeover would increase its production capacity by around 100,000 metric tonnes, allowing the company to capture growth opportunities in the Mediterranean region.
"The negotiations with Nestle and with the employee representatives went very well and all works relating to the transfer have been initiated in due course so that we were ready to take over on July 1," said Patrick De Maeseneire, chief executive officer of Barry Callebaut.
The company reported last week that like-for-like sales increased 6.1 per cent in the nine months to 31 May. It said sales revenue growth was 5.9 per cent in Europe, plus more than this within Eastern Europe.
Barry Callebaut had sales of about CHD4bn (€2.4bn) in the fiscal year ended 31 August 2006 and operates in 23 countries worldwide.