Ferrero to buy Nestlè’s US candy bar

The Italian confectionery giant seems to be poised to pay as much as $2 billion to win an auction of Nestlè brands including Crunch, Butterfinger and Kit Kat
Ferrero to buy Nestlè’s US candy bar

Ferrero Group, the Italian leader in confectionery, is close to buying Nestlè’s US candy bar business. According to New York Post, the Italian company based in Piedmont – which makes Nutella as well as the Ferrero Rocher chocolate-and-hazelnut bon-bons – seems to be poised to pay as much as $2 billion to win an auction of Nestlè brands including Crunch, Butterfinger and Kit Kat. That’s on the heels of Ferrero inking a $1.25 billion buyout earlier this month of Ferrara Candy, which makes Red Hots, Now and Later, Jujyfruits and Super Bubble.

The US confectionery business

If Ferrero buys the Nestlè business, it will become the third-biggest US confectionery business, trailing only Hershey and Mars. Ferrero’s main competition in the auction has been Hershey, but that likely changed when Hershey agreed to buy Amplify, the maker of Skinny Pop popcorn, for $1.6 billion. A small group of private equity firms are now the only other known suitors still in the process for Nestlè’s $922 million US confectionery business, which also includes Baby Ruth, Sno-Caps and Willy Wonka. Nestlè is expected to choose a winner in the first few weeks of the new year. Last week, Nestlè said it expected to sell the division by the end of March. Family-run company Ferrero, which now generates more than $12 billion in sales, didn’t want to buy the Nestlè US confectionery business without a significant US platform to fold it into and the Ferrara deal gives it such a platform. Ferrero early next year plans on opening an innovation center on Cornell’s new tech campus on Roosevelt Island.

Pasta: Rana buys a Nestlè’s plant in Piedmont

Meanwhile, Nestlè’s Italian branch announced that it has signed the preliminary agreement for the sale of the plant of Moretta (Cuneo, Piedmont) to Italian pasta company Giovanni Rana. The factory produces fresh filled pasta and sauces with the Buitoni brand. The brand will remain the property of Nestlé, which will continue to invest in innovation and research. The agreement provides for the full employment retention of 190 workers. Following the commercial agreement, Rana will distribute fresh pasta and Buitoni sauces throughout the Europe, Middle East & North Africa area, with the exception of Italy and Spain, where the Buitoni brand will continue to be marketed by Nestlé. The operation will be finalized in the coming weeks.

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