Barry Callebaut announces major deal in US
The world’s largest industrial chocolate manufacturer, Barry Callebaut, has announced the acquisition of Brach’s Confections, expanding its consumer business in the United States.
Barry Callebaut is buying the company for a symbolic $1 (SFr1.4) from KJ Jacobs and assuming $16 million in debt.
KJ Jacobs holds 69.9 per cent of Barry Callebaut shares and is the family company of German industrialist Klaus Jacobs.
In a statement on Monday, Barry Callebaut said the deal would create a platform to build an attractive consumer confectionery business in the US, one of its priority geographic markets.
It added that the acquisition would complement the company’s strong presence in the European consumer marketplace, established last year with its acquisition of the German Stollwerck group.
Brach’s Confections reported sales of about $340 million in the fiscal year 2002/2003, with a staff of 1,600.
Barry Callebaut said the transaction would give it access to new distribution channels and the opportunity to strengthen and extend relationships with large retailers in the US.
Complementary acquisition
The deal, which is expected to close later this month, will expand Barry Callebaut’s sales revenues from its consumer products business by about 45 per cent to one third of total sales.
Under the terms of the purchase conditions, Barry Callebaut is to provide Brach’s with $48 million over the next four to five years for the company to complete a restructuring programme.
“The operational expertise of Barry Callebaut, as well as our experience from the ongoing restructuring of the Stollwerck group makes us confident… we will complete Brach’s restructuring successfully within the next four months,” commented Barry Callebaut chairman Andreas Schmid.
“The optimised cost structure will allow Brach’s to drive profitable growth in the future,” he added.
swissinfo with agencies
Brach’s, which has its headquarters in the suburban Chicago area, was founded by Emil J Brach in 1904.
It produces nearly 200 varieties of confections, including hard candies, chocolates and fruit snacks.
The company is best known for its Star-Brites Mints, Milk Maid Caramels and Maple Nut Goodies.
Barry Callebaut is to acquire Brach’s Confections in the US for a symbolic $1.
However, it will assume $16 million of debt and pay about $48 million in restructuring costs.
The deal is expected to close later this month.
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