Ferrero has agreed to acquire Thorntons for £112 million in a transaction that brings the 104-year-old British chocolate-maker under the same roof as Nutella hazelnut spread.
The closely held Italian company will pay 145 pence a share, or 43 per cent more than the UK confectioner’s last closing price in London on Monday, it said in a statement.
The deal will seek to build on the heritages of companies that are linked closely to chocolate. Although formed three decades later than Thorntons in 1946, Ferrero has grown into one of the world’s biggest confectionery companies, with annual sales of about €8.4 billion from brands like Tic Tac and Ferrero Rocher. Thorntons, which opened its first store in 1911, is little known outside the UK and had revenue of £222 million last year.
For Ferrero, the transaction provides an opportunity to expand in a country it entered in 1966 and where it had record results last year. Adding the company’s 5.4-per-cent share of the local chocolate confectionery market to Thorntons’ 2.9 per cent will establish a clear industry No. 4 behind leaders Mondelez, Mars and Nestlé, according to Nielsen data.
“We delivered our best-ever results in the UK in 2014, giving us confidence that now is the right time to broaden our roots in this important market,” Giovanni Ferrero, chief executive officer of Ferrero, said in a statement.
News by Bloomberg, edited by ESM
