South Korea's leading confectionery maker Lotte has bought a Shanghai-based chocolate company, as it seeks to expand in the fast-growing Chinese market.
The company, which already makes significant sales in China from its gum and candy products, told AP-Foodtechnology.com that it had signed a deal worth US$20 million with Shanghai BBCA Aloha Chocolate.
The company runs two factories with an aggregate annual capacity of 30,000 tons of chocolate, Lotte Confectionery said.
The acquisition will give Lotte its first chocolate production site in China. It will also gain chocolate trademarks from the Chinese producer's parent company Anhui BBCA Group.
The Chinese chocolate market, worth around US$740 million last year, is growing rapidly. Some estimates say growth in recent years has averaged 26 per cent annually, significantly faster than larger, more mature markets like Japan.
And the market is already much larger than Lotte's domestic market - in Korea, chocolate sales reached about US$400 million last year.