Nestlé has sold its US candy business ($924m in 2016 sales), which includes Butterfinger, Baby Ruth and Raisinets, to Nutella maker Ferrero for $2.8bn in cash.
Ferrero would become the ‘third largest player in chocolate confectionery in the world if it successfully acquires Nestlé’s US candy business, a deal that is expected to come through by the end of this week, said Euromonitor.
While Mars is currently the market leader in China’s chocolate confectionery space, Ferrero has been growing over the past five years with increased shares year-over-year, the latest Euromonitor data shows.
A survey conducted by YouGov Australia shows that Cadbury is Asia Pacific’s (APAC) favorite chocolate brand, chosen by 25% of the respondents in the region.
Ferrero is to acquire all the equity of Fannie May Confections brands, including its subsidiaries Fannie May Confections and Harry London Candies from 1-800-Flowers.com for $115m.
Ferrero is nearing the acquistion of biscuits firm Delacre in an attempt to decrease its reliance on chocolate and expand in North American, says market analysts Euromonitor.
Ferrero has terminated all relations with subcontractors Prolegis in Romania after allegations children had been working long hours for low pay to produce toys for Kinder Eggs.
Analysts say Hershey may be eyeing a joint venture or merger with a major international player such as Ferrero, but the US chocolate giant has dismissed the claims as “speculation”.
By Jack Skelly, analyst at Euromonitor International
Ferrero has given strong indications it hopes to grow in chocolate confectionery retailing by acquiring UK chocolate maker Thorntons, writes Euromonitor analyst Jack Skelly.
Euromonitor International expects more chocolate makers will take vertical control of their supply chains by acquiring commodity suppliers as prices continue to climb.
The European Commission has cleared Ferrero’s acquisition of hazelnut supplier Oltan and says there are no competition concerns due to ample alternative suppliers on the market.
Ferrero’s plans to build a new production facility in the UK and double its sales here to £400M by 2015 were abandoned because of capital expenditure constraints, it has been revealed.
Nestlé has extended its partnership with expansion services firm DKSH to bring confectionery brands such as Kit Kat, Milo Confectionery and Uncle Toby’s to traditional trade channels in Singapore.
Belgian truffle maker Duc d’O has entered India through a distribution deal with Cosmo Fine Foods and hopes to target increasingly affluent Indian consumers.
Mondelēz International has upped the cocoa content and revamped the packaging of its Cadbury Bournville brand in India to appeal to the growing middle classes.
Italian confectioner Ferrero’s French subsidiary has announced plans to use barge transport in a move that it has said will eventually cut 30% in CO2 emissions and take 260 truckloads off the road.
The sugar confectionery category in China achieved growth of 3 and 4 per cent in retail value and volume terms respectively in 2010, according to estimates from Euromonitor.
Fuelled by a combination of health concerns and changing tastes,
dark chocolate has become one of the most rapidly growing sectors
in the confectionery market in the last year.
Italian confectioner Ferrero has won its battle against Chinese
counterfeiters who have been producing copycat versions of its
products for the Asian market.
