News: Fennobon Sold
Chewing gum makes up approximately 10% of Finland's total confectionary market, and the corresponding share in Sweden is 6%. Among other things, the acquisition of Fennobon Oy will give Cloetta Fazer expertise in sugar-free products and a strong position in a fast-expanding product segment. "In line with our strategy, we are seeking growth by diversifying into product areas where we currently have a weak position or none at all. Until now, Cloetta Fazer has not had any products of its own in this segment. Consumers in Finland have shown a preference for sugar-free chewing gum for many years and this trend is also visible in other European countries. We see major potential to expand in this segment. Fennobon is an innovative player and we are very pleased with the knowledge and opportunities this company brings to us," says Cloetta Fazer's CEO Jesper Aberg. Fennobon has its factory in Karkkila, Finland, northwest of the capital city of Helsinki. The company was established in 1990 and has 42 employees. In 2006, Fennobon reported annual sales of approximately SEK 66 million (EUR 6 million). Of the total sales volume, around 40% is exported to countries including Japan, the U.S. and Germany.
"Delivery reliability, consumer knowledge and superior quality are key success factors for Cloetta Fazer. Today, we sell our products primarily in the Nordic and Baltic regions and see the advantages or manufacturing the products in our own factories, close to the consumers in our home markets. Fennobon sells products of a high quality and is currently the only domestic chewing gum maker in Finland. The acquisition is consistent with our growth strategy and we expect it to open new opportunities in the market," says Aberg.
All of Fennobon's products are made at the production facility in Karkkila and production is planned to remain there. Cloetta Fazer's growth target in the chewing gum segment also calls for increased production capacity at the factory.
"Our aim is to grow and strengthen our brands, and we believe that we will have better scope for ongoing developing of the company as part of the Cloetta Fazer Group," says Miska Kuusela, managing director of Fennobon and will continue in this role following the acquisition.
The transfer of ownership will take place on January 1, 2008. The parties have agreed not to disclose the purchase price.
For Cloetta Fazer, the acquisition of Fennobon represents a growth venture in the chewing gum segment. "Nearly all chewing gum sales in Finland consist of products with a high xylitol content of the type Fennobon has specialized. We strongly anticipate continued growth for the chewing gum segment and will invest ambitiously to develop and market these products," says Tom Lindblad, managing director of Cloetta Fazer's Finnish subsidiary Cloetta Fazer Confectionery Ltd.
From the December 3, 2007, Prepared Foods e-Flash