Kraft sells Romanian business to investment fund Oryxa

By Jane Byrne

- Last updated on GMT

Related tags: European union, Romania, Cadbury plc, Kraft foods

US food giant Kraft Foods has announced the sale of the Cadbury owned Kandia-Excelent chocolate, sugar confectionery and cake business in Romania to Oryxa Capital, an international investment fund, subject to regulatory approval.

Cadbury acquired the leading Romanian sweet maker in 2007 but Kraft has been forced to divest of it under EU competition rules as part of its contentious takeover of UK confectionery giant in February this year.

Last month, Kraft also announced that Asian confectionery giant Lotte Group would acquire the Wedel business in Poland, another brand it had to find a buyer for in order to satisfy European Commission approval of its acquisition of Cadbury.

The sale includes Kandia-Excelent brands such as Rom, Magura, Kandia, Laura, Sugus and Silvana, related trademarks, and the manufacturing facility in Bucharest.

The US company did not disclose the financial details of the deal but said that it will retain the global Cadbury brands, including Halls cough sweets.

Doina Cavache, a spokesperson for Kraft Foods, told that they had received bids from several interested parties but chose Oryxa as they has sought a buyer who would ensure the Romanian confectionery market remained competitive.

Nicholas Hill, a spokesperson for Oryza, said that it aimed to expand the Kandia-Excelent business, with one of its future goals being to export the Romanian sweet maker's brands to other European markets.

The market for confectionery in Romania increased at a compound annual growth rate of 5.4 per cent between 2004 and 2009, with the chocolate category taking the lion’s share, accounting for 46.3 per cent of the market, according to Datamonitor.

Indeed, Jonathan Thomas, principal market analyst at Leatherhead Food International, said that the Romanian chocolate market is one of the more promising in Eastern Europe.

"Although per capita consumption is low at around 2.2 kg, more consumers are turning towards chocolate, since it is no longer considered the luxury item it once was,"​ said the analyst.

He added that the market for premium confectionery products is expected to lift once the economic situation improves.

Kandia-Excelent, which has an annual chocolate production capacity of 20,000 tonnes, has 530 employees on its books.

Related topics: Manufacturers, Mondelez International

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