Global confectionery group Ferrero is acquiring Néstle’s US confectionery business for US$2.8 billion in cash. Néstle’s US business has more than 20 American brands with a rich heritage and strong awareness, including iconic chocolate brands such as Butterfinger, BabyRuth, 100Grand, Raisinets and Wonka, and the exclusive right to the Crunch brand for confectionery and certain categories in the US, as well as sugar brands such as SweeTarts, LaffyTaffy and Nerds.
Néstle’s US confectionery business generated sales of approximately $900 million in 2016.
“We are very excited about the acquisition of Néstle’s US confectionery business, which has an outstanding portfolio of iconic brands with rich histories and tremendous awareness,” Giovanni Ferrero, executive chairman of the Ferrero Group, said. “In combination with Ferrero’s existing US presence, including the recently acquired Fannie May Confections Brands and the Ferrara Candy Company, we will have substantially greater scale, a broader offering of high-quality products to customers across the chocolate snack, sugar confectionery and seasonal categories, and exciting new growth opportunities in the world’s largest confectionery market.”
With this transaction, Ferrero will become the third-largest confectionery company in the US market where it is best known for Tic Tac breath mints, Ferrero Rocher pralines, Nutella hazelnut spreads, the Fannie May and Harry London chocolate brands, and the Ferrara Candy Company, which was recently acquired by a Ferrero-affiliated company and whose portfolio of brands includes Trolli, Brach’s and Black Forest Gummies.
Ferrero will also acquire Néstle’s US manufacturing facilities in Bloomington, Franklin Park and Itasca, all in Illinois, and the confectionery-related employees, and will continue to operate through the offices in Glendale, California, as well as from its other current locations in Illinois and in New Jersey.
The transaction, subject to customary closing conditions and regulatory approvals, is expected to close around the end of the first quarter of this year.