FoodMondelēz buys ‘majority’ stake in fast-growing Chinese cake and...

Mondelēz buys ‘majority’ stake in fast-growing Chinese cake and pastry maker

-

spot_img


This audio is auto-generated. Please let us know if you have feedback.

Dive Brief:

  • Mondelēz International is buying a “significant majority stake” in Evirth, a leading manufacturer of cakes and pastries in China, the snacking giant said in a statement. The ownership stake and financial terms were not disclosed.
  • The Oreo and Ritz maker said the deal “represents an important step” to accelerate its growth in the cakes and pastries category. The segment is a core focus for the company, alongside chocolate and biscuits.
  • Mondelēz already has a minority investment in Evirth to develop, manufacture and supply frozen-to-chilled cakes and pastries in China featuring some of its brands, including Oreo and Philadelphia.

Dive Insight:

While Mondelēz has established a market-leading position in some snacking categories, the packaged food giant has openly communicated its desire for a deeper presence in others. 

“Cakes and pastries is a segment where our brands can be,” said Martin Renaud, executive vice president and chief marketing and sales officer at Mondelēz, told Food Dive last year. “We can build a very strong leadership position quickly.” He noted that the category lacked “a very big, strong player.”

The company’s growth in the cakes and pastries sector has largely been driven by acquisitions.

In 2020, it acquired Give & Go, a U.S.-based maker of brownies, cupcakes, and other items. A year later, it added Chipita, a player in croissants and baked snacks in Central and Eastern Europe. Additionally, the company’s existing brands such as Oreo (with Cakesters soft snack cakes) and Cadbury (with Chocobakes – cookies and layered cakes filled with chocolate) also compete in this space.

Cakes and pastries provide another way for Mondelēz to tap into the valuable equity it has built up with many of its snacking brands, most notably Oreo and Cadbury, to boost sales and increase its presence in other usage occasions. Cakes and pastries, for example, bring brands deeper into occasions such as birthdays.

It would tap into that further with the stake in Evirth. In China, the frozen-to-chilled cakes and pastries market is currently estimated at $3 billion, growing at a compound annual growth rate of about 15%, percent, Mondelēz noted. China has a population of more than 1.4 billion, providing Mondelēz with a lengthy opportunity for growth

The Chicago-based snacks maker has purchased several companies globally to fill gaps within its portfolio since Dirk Van de Put took over as CEO in late 2017.

In the U.S., it has snapped up Tate’s Bake ShopPerfect Snacks and Clif BarVan de Put told analysts in February Mondelēz looks at 35 or 40 potential M&A targets at the beginning of each year. Most never lead to a deal.



Source link

Latest news

Mark Gong Shanghai Spring 2025 Collection

The Shanghai collections kicked off this week but a visa snafu has left this reviewer grounded in New...

Boeing to cut 17,000 jobs and delay 777X jet as revenues fall short

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favourite stories in this weekly...

Trump speaks in Denver suburb after vilifying migrant community – US elections live | US elections 2024

Trump repeats anti-migrant claim officials say is exaggeratedTrump is now repeating his claim, which local officials say is...

19 Black-Owned and -Founded Skin-Care Brands You Should Have on Your Radar

The skin-care industry hasn’t always been inclusive of melanated skin—just look at the lack of diversity in clinical...
spot_img

What Escalation in the Middle East War Means for the Industry

It’s been a year since the mass killing and abduction of Israelis carried out by Hamas on Oct....

JPMorgan and Wells Fargo beat forecasts as US consumers show resilience

Stay informed with free updatesSimply sign up to the US banks myFT Digest -- delivered directly to your...

Must read

Mark Gong Shanghai Spring 2025 Collection

The Shanghai collections kicked off this week but...

Boeing to cut 17,000 jobs and delay 777X jet as revenues fall short

Unlock the Editor’s Digest for freeRoula Khalaf, Editor...
spot_img

You might also likeRELATED
Recommended to you