Orkla restructures confectionery business and appoints division head

By Oliver Nieburg

- Last updated on GMT

Orkla's confectionery brands include Oslo-based chocolate business Nidar
Orkla's confectionery brands include Oslo-based chocolate business Nidar

Related tags Denmark Sweden Norway

Norwegian consumer goods firm Orkla has announced plans to reorganize its confectionery and snacks business and has appointed the former head of Arla Foods in Sweden to lead the division.

The company split its confectionery and snacks portfolio from Orkla brands in January this year when it divided operations into five segments.

Yesterday, it was announced the confectionery and snacks division would undergo further refining with separate companies in each of Norway, Sweden and Finland. Christer B. Åberg, who had been CEO of Arla Foods AB Sverige and Finland since 2009 was also appointed CEO of the division.

The new structure

Orkla’s confectionery and snacks divison will merge snack chips brand KiMs Norge, biscuit brand Sætre and chocolate business Nidar into a single company in Norway.

Snacks chips brand OLW and biscuits business Göteborgs Kex will merge in Sweden, while the Chips brand and licorice and chocolate business Panda will come together in Finland.

KiMs in Denmark and Latfood in Latvia will be unaffected by the mergers.

Logical split

Håkon Mageli executive vice president corporate communications, said “The split is to make more logical homes for the companies…This makes it easier for competence building.”

He said that Orkla would not employ more people nor axe jobs as the measure was not about cost-cutting.

Orkla President and CEO Åge Korsvold added: “It is absolutely essential to determine how we can increase our competitive strength and create new growth opportunities in the Nordic region. We must be optimally equipped to do battle with strong international players. Establishing larger entities will create more opportunities for innovation within and between categories.”

Orkla’s confectionery and snacks division has an annual turnover of around NOK 4.8bn ($836m) and employed 2,231 people at the end of last year. Orkla’s total sales are approximately NOK 30bn ($5.2bn) and it has around 28,000 employees.

Market share & Norwegian confectionery landscape

Mageli said that Orkla was the number two chocolate company in Norway and the number one biscuit firm in Sweden.

Mondelez International has a dominant presence in the Norwegian chocolate market.

According to data from Nielsen, chocolate sales in grocery Shops in Norway amounted to NOK 4.36bn ($760m) in the last 52 weeks up NOK 75 million ($13m) compared to the same period last year.

Biscuit sales also rose 2.9% in grocery stores to NOK 1.19bn ($207m).

According to Scandinavian confectioner Cloetta’s annual report, the Nordic region has a low per capita consumption of chocolate compared to the rest of Europe but a significantly higher consumption of sugar confectionery.

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