Swiss chocolate maker buys German rival Stollwerck

Barry Callebaut, the world's top manufacturer of cocoa and chocolate products, has confirmed that it will buy German chocolate firm Stollwerck from Imhoff Industrie-Holding in a CHF256 million (€174.9m) deal, reported Reuters.

The deal will create a group with combined 2001 proforma sales of CHF3.33 billion, or €2.21 billion, Callebaut said.

The cash-and-equity deal involves Callebaut taking on Stollwerck debt and will result in a restructuring charge to 2001/02 accounts.

The one-off charge of about 80 million francs would be followed by cost synergies to the tune of about 32 million francs a year, with the full amount to be realised from 2004/05.

Callebaut said that in view of the charge, the board of directors favoured leaving the 2001/02 dividend unchanged.

Some four percent of Stollwerck's equity is privately held, and Callebaut said it plans to buy out these investors at a price to be set after approval of the deal by German regulators.

The deal gives Callebaut a leading position in Germany and is part of Callebaut's strategy to move out of the sale of semi-finished products such as cocoa butter and powder and into higher-margin businesses.

Stollwerck has annual sales of around €700 million, but recently sold off its East European operations to Kraft Food International, part of US food group Kraft Foods.

Callebaut reported flat net profit of 67 million francs on sales of 1.32 billion in the six months to end-February 2002, down 9.5 per cent from the year-earlier period.

Klaus J Jacobs Holding and other members of the Jacobs family hold 69.9 per cent of Callebaut. Jacobs was scion of the Swiss chocolate and coffee empire Jacobs Suchard that was sold to Kraft's former parent Philip Morris Cos in 1990.