Nestle in Chinese sweets deal, Lonza goes for American biochem
Update 15:25 GENEVA, SWITZERLAND – Vevey-based Nestlé has entered into an agreement with the founding family of Hsu Fu Chi, one of China’s main snack and sweets manufacturers, with four large plants and 16,000 employees. In the deal worth CHF1.4 billion, the Swiss company will ultimately control 40 percent of the company, which is listed in Singapore.
The deal will need government approval.
Nestlé intends to acquire 60 percent of Hsu Fu Chi while the Hsu family will own the remaining 40 percent, the Vevey multinational said in a press release Monday 11 July. Hsu Fu Chi’s chairman and chief executive officer, Hsu Chen, will continue to lead the company in the new partnership.
The Swiss company says of the deal that Hsu Fu Chi has a large range of “affordable products”, with a portfolio that “includes sugar confectionery, cereal-based snacks, packaged cakes and the traditional Chinese snack sachima. Hsu Fu Chi’s products are tailored to Chinese consumers’ needs and habits, and complement Nestlé’s existing product portfolio in China, which includes culinary products, soluble coffee, bottled water, milk powder and products for the foodservice industry.”
Bloomberg points out that the Chinese company’s growth rate in 2010 was three times that of Nestle’s worldwide, noting that “Nestle’s Bulcke, 56, has set a goal of getting 45 percent of revenue from developing countries by 2020, compared with about a third now.”
Basel company takeover of US firm to create world’s largest microbial control firm
Basel-based Lonza will become the world’s largest microbial control company in terms of sales, which are estimated at CHF1.6 billion, once its agreement to buy Arch Chemicals, a Connecticut-based US company, goes through. The deal to take over Arch’s outstanding shares of common stock at a price of $47.20 per share in cash will give Arch Chemicals an enterprise value of $1.4 billion (approximately CHF 1.25 billion), the two companies said in a statement released Monday 11 July.
Lonza Group Ltd is one of the world’s largest suppliers to the pharmaceutical, healthcare and life science industries. Arch Chemicals, Inc. is a global biocides company that provides “innovative solutions to destroy or to selectively inhibit the growth of harmful microorganisms”.
Microbial control is the process of inhibiting or preventing the growth of microorganisms, generally by using agents that either kill them or inhibit their growth. Agents that kill or called “cidals” and those that inhibit are “static agents”.
“Currency factors will help Lonza in the case of Arch,” reports the Financial Times. “The group will borrow to finance the deal, benefiting both from ultra low US interest rates and the strength of the franc.”
Merger approved by Competition Commission, but Tamedia recently accused of “abuse”
Recycling newspapers: it's taking longer to fill up the bin
Geneva, Switzerland (GenevaLunch) - Tamedia and Edipresse, two of Switzerland’s largest print and online media companies, will celebrate their marriage sooner than expected. The complete merger was expected in 2013, but the companies now say they will merge this year, when Tamedia’s purchase of 50.1 percent of the shares is completed.
Tamedia will spend a total of between CHF269.8 and 330.2 million, plus 250,000 registered Tamedia shares, to buy out Edipresse, it says in a press release issued 7 April.
The news comes as the shakeout of Swiss media continues, with several developments in recent days:
- newspapers in French-speaking Switzerland again had a serious bleed of readers in 2010, including the number one, free paper 20 Minutes, Mach (industry agency that tallies official circulation figures) reported 22 March 2011, with German-speaking areas doing better, but nevertheless seeing falling sales
- Tamedia was accused 1 April of abusing its position of power following its takeover of Edipresse, for sharply increasing advertising rates
- five regional newspapers joined forces this week, with a shared platform starting 5 April for international, national and business/economic news.
French language papers in “free fall”
Remp publishes an annual Mach reports in March of every year on how Swiss media fared the previous year, with sales and circulation details which serve as the bible of the advertising industry.
Circulation figures have been falling for a number of years but the process appears to have speeded up in 2010, with public television TSR reported that French-speaking newspapers in particular were in “free fall” last year, in terms of losing readers.
Cadbury, the independent British chocolate maker, will take on an American flavour, news that sent its shares up by 3 percent Tuesday morning 19 January. The company announced that it has accepted US multinational Kraft’s takeover bid, which has been opposed by British Business Secretary Peter Mandelson. The final details, including the price paid, will be released shortly, the companies said in a joint announcement. The Financial Times reports that the deal could be worth £11.7bn ($19bn). Mandelson has voiced concerns that the US company wanted to make a “fast buck” from Cadbury’s, and unions have expressed fear that jobs will be lost. Cadbury employs 45,000 people worldwide, including staff at a Swiss site in Rolle, canton Vaud.
Links to other sites: Financial Times, Times, UK
Vevey, Switzerland (GenevaLunch) – The ongoing guessing game about who will own Cadbury is expected to end Wednesday 6 January when Kraft unveils shareholder response to its hostile takeover bid for Cadbury, but Nestlé won’t be one of the owners. The Swiss-based Nestlé says it is not bidding on Cadbury, ending speculation that it would fight Kraft for the UK-based Cadbury sweets company. Nestlé has instead offered to buy Kraft’s pizza division, the leader in the US and Canada in the frozen pizza market.
Nestlé’s $3.7 billion offer for the pizza business is allowing Kraft to increase its cash offer for Cadbury.
The pizza deal covers a number of brands, including DiGiorno, Tombstone, California Pizza Kitchen, Jack’s and Delissio.
