Already a leading player in the snacking industry, Mondelēz International has recently announced a new move to fortify its position in the category. The snacking company revealed that it has reached an agreement to acquire Chipita S.A., a high-growth name in the Central and Eastern European croissants and baked snacks category, for approximately $2 billion. With this recent acquisition, Mondelēz will expand its reach in the $65 billion packaged cakes and pastry sector while continuing to grow across the globe.
“Welcoming Chipita S.A.’s delicious pastry products into the Mondelēz International family advances our strategy to become the global leader in broader snacking,” said Dirk Van de Put, Chairman and CEO of Mondelēz International. “Their iconic brands and significant scale across so many attractive geographies make them a strong strategic complement to our existing portfolio and future growth ambitions in Europe and beyond.”
Chipita S.A. was first established in Greece more than 40 years ago and has generated over $580 million in revenue in 2020, according to a press release. The company has shown consistent growth across its portfolio of croissant and baked snack brands, which include 7Days, Chipicao, and Fineti.
All of Chipita S.A.’s products are produced in 13 manufacturing plants and delivered to more than 50 countries, reaching over 2 billion consumers. Through this acquisition, Mondelēz International will be enabled to offer a wider portfolio of bakery offerings, meeting the growing consumer demand across the category.
“Chipita, for more than 40 years, based on quality and innovation created a new category of snacks loved by consumers internationally. I am certain that the acquisition of Chipita by Mondelēz International, one of the world’s leading snacking companies, will create new prospects for its people and products,” commented Chipita S.A.’s Chief Executive Officer, Spyros Theodoropoulos.
In addition to expanding its portfolio, the deal will offer Mondelēz a significant increase in presence in the booming Central and Eastern European markets, where Chipita S.A.’s business is well positioned. Likewise, it will allow Mondelēz to enhance its distribution region and network capabilities to continue to bring its brands to new countries.
Mondelēz International plans to fund the purchase price of approximately $2 billion, which is subject to certain closing purchase price adjustments, through a combination of new debt issuance and existing cash.
The company expects the transaction to be immediately accretive to earnings per share from closing.The perimeter of the transaction does not include P.G. Nikas S.A., a meat-processing business, or Chipita S.A.’s minority interest in its Indian joint venture.
As Mondelēz International further enacts its wide-sweeping growth strategy, what will be the next move from the major industry player? Only time and Deli Market News will tell.