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Ferrara Candy Company to close two sites after merger

By Oliver Nieburg+

26-Jun-2012
Last updated on 26-Jun-2012 at 17:36 GMT

US confectioners Farley’s & Sathers and Ferrara Pan have announced plans to shut a manufacturing facility and a packaging and distribution plant following the two firms’ merger to become the Ferrara Pan Candy Company.

The closures

The new US company said in a statement issued yesterday that Farley’s & Sathers’ Round Lake facility in Minnesota would close in phases starting this summer and ending in Autumn/Fall 2013.

The firm will also wrap-up its packaging and distribution functions at Cummings Road in Chattanooga, Tennessee by Autumn/Fall this year. In addition, the Sather Trucking Company based in Chattanooga will be closed over the same period.

The Chattanooga operations will be consolidated into existing facilities within the newly combined network.

Efficiency move

The new company will be headquartered in Chicago, Illinois and led by Ferrara chief Salvatore Ferrara II who will become chairman and CEO of the merged company.

The company said in its statement: “These transitions are a logical result of the merger. Together, we are creating a leading general line candy manufacturer that is more efficient and well-positioned to grow faster and take innovation to the next level.”

“Unfortunately, this impacts positions in Round Lake and Chattanooga.”

The two companies

Farley's & Sathers was only established in 2002 and has since grown its market share through bolt-on acquisition including Now and Later, Trolli and Brach’s Confections.

It claims to manufacture a million pounds of gummies each week at its four manufacturing sites in the US and two in Mexico.

Farley’s is owned by private equity firm Catterton Partner, which will remain as the majority investor in the combined company.

Ferrara Pan Candy is a private company based in Illinois and has a longer history than Farley’s, which dates back to 1908.

The firm has five production facilities located in the United States, Canada and Mexico, and employs around 800 people.

Analyst on the merger

Marcia Mogelonsky, director of insight for Mintel Food and Drink recently told this site that Ferrera Pan had missed an opportunity to partner with an Asian firm to capitalise on growth in emerging markets.

However, she said the new Ferrara Candy Company would be a formidable private label force in the US with a solid and broad combined distribution network.

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