Kandia, Excelent to seal merger
competitive as the third largest player, Kandia, prepares to
finalise a merger with Excelent - a move that will create the
leading producer on the market.
Kandia, which already has a 62 per cent stake in Excelent, is due to hold a shareholders meeting on 17 February, when it says the final agreement for the merger will be endorsed. If the go-ahead is given by shareholders and the executive board, then the merger will go ahead and Kandia will absorb Excelent.
Kandia bought a majority stake in Excelent in April last year at a cost of $6 million. At the time, industry experts said that the move would eventually lead to a total merger which would consolidate the growing but still fragmented Romanian chocolate market.
Reflecting an increased level of investment from Kandia, the company announced that it was upgrading Excelent's production facilities and spending a significant amount of money to advertise and market its brands. The estimated cost of the investment was put at $17.5 million.
During the course of the 1990s, the sector saw a raft of new players joining the small local market. These included Swiss company Heidi, which built a factory in Bucharest, and local companies Modares and Witt and Prodimex.
Excelent-Kandia currently has a combined market share of almost 40 per cent, closely followed by Kraft Foods Romania, which has a 35 per cent share of the market. The next biggest players are Primola with 8 per cent and Heidi with a 6.8 per cent share.