Italian confectionery group Ferrero is to acquire Ferrara Candy, the third largest manufacturer of non-chocolate confectionery in the US.
Illinois-headquartered Ferrara is a major player in the US confectionery market, best known for its Trolli gummy candies and Lemonheads. It was one of five companies which, along with Nutella maker Ferrero, committed to reducing the number of calories in its individually wrapped products back in May.
As well as Trolli and Lemonheads, Ferrara Candy owns Brach’s, the seasonal candy brand; Black Forest Organics, which makes organic and fruit-flavoured candies; and fiery cinnamon confection RedHots.
The acquisition is a coup for Ferrero; it expands the Italian company’s presence in the US at an important time, following the agreement to acquire premium boxed chocolate company Fannie Mae in March.
Ferrero recently introduced Tic Tac gum and Kinder Joy to the US market, with both products set to be available in stores in January.
Chairman Giovanni Ferrero said: “We are pleased to welcome the Ferrara business, brands and people to Ferrero. With this acquisition, we are continuing to increase our overall footprint and product offering in the important US market, establishing a presence in new confectionery categories with attractive growth prospects including gummy and seasonal candies.
“We look forward to continuing to grow the Ferrara business, investing in its brands to support expansion plans, leveraging its US manufacturing plants and distribution centres, and creating opportunities for its talented people.”
Ferrara Candy chief executive Todd Siwak added: “We are pleased to announce this agreement with Ferrero, which will enable the continued growth and momentum behind our iconic and well-loved brands. We have long admired Ferrero’s core values of loyalty and trust, respect and responsibility, integrity, and commitment to quality, which align closely with our passion for bringing smiles to generations of candy lovers.
“Joining forces with Ferrero gives us the opportunity to accelerate our growth plans in the US and international markets, and share best practices as part of a larger, stronger organisation.”
Ferrara Candy is being acquired from private equity group L Catterton.
Ferrero expects to operate Ferrara as a separate unit and to maintain Ferrara’s headquarters in Oakbrook Terrace, Illinois – a suburb of Chicago.
In recent times, Ferrara has consolidated its manufacturing and distribution footprint to four plants in Bellwood and Forest Park, Illinois, as well as Reynosa and Vernell, Mexico; two distribution centres in Bolingbrook, Illinois and Grand Prairie, Texas; and an engineering and R&D centre in Bellwood, Illinois.
Ferrero intends to maintain and leverage this existing footprint with no further planned consolidation, the Italian group said.
The transaction is expected to close in the fourth quarter of 2017.
© FoodBev Media Ltd 2017