Katjes International to acquire Cloetta Italy

European confectionery company Cloetta has signed an agreement to sell its struggling Italian business to Katjes International in a deal worth SEK450 million ($53.3m).

The move, which is expected to close in the third quarter of 2017, comes six months after Cloetta revealed it may sell the Italian unit as part of a strategic review, aimed at improving overall growth and margins.

Henri de Sauvage-Nolting, CEO of Cloetta, says, “I am very pleased that we have found a new home for our Italian brands, factories and employees. We already know Katjes and are well aware of their business experience and good employer track record.

“I am convinced that they will be able to manage and develop the business going forward. This is a very good solution for all parties and follows Cloetta’s strategy to focus more on its business in north-western Europe including the recently acquired Candyking business.”

The deal includes the complete Italian commercial organisation, around 400 employees, its four production units in Cremona, Gordona, San Pietro in Casale and Silvi Marina, as well as all Italian brands, including Sperlari, Saila and Dietorelle.

The divestment will result in an impairment estimated to around SEK365m before tax that will be reported in the second quarter of 2017.

Danko Maras, CFO of Cloetta, adds, “The impairment of Cloetta Italy recognises a challenging business performance over time that have eventually led to this decision.

“However, the divestment of Cloetta Italy will enable Cloetta to reach its EBIT margin target of 14% in a more focused way. The divestment will improve Cloetta’s margins and return on capital employed.”

Katjes International claims to be the market leader in Belgium. It is number two in France and will equal rank number two in Italy with this acquisition.

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