Barry Callebaut completes Japanese acquisition

By Charlotte Eyre

- Last updated on GMT

Related tags: Barry callebaut, Japan, Chocolate, Asia

Swiss-based Barry Callebaut today announced the completion of a
deal to acquire production facilities from Japanese company
Morinaga, only one day after the inauguration of the company's
manufacturing plant in China.

The acquisition is part of a growing trend of confectionery companies moving into the Asia Pacific region, eager to cash in on a burgeoning taste for chocolate as well as higher consumer power in the area. "Our transaction with Morinaga is a milestone in our strategy to strengthen our footprint in the fast-growing Asian markets,"​ said Barry Callebaut chief executive officer Patrick De Maeseneire. "Our expansions inJapan,ChinaandIndiawill give us access to more than 2.5 billion potential future consumers." ​ The company first entered into the Japanese deal to acquire production equipment, as well as lease land and buildings from Morinaga, in September 2007. It has also entered into a 10 year supply agreement for 9,000 tonnes of liquid chocolate with Morinago, which it hopes will double Barry Callebaut's sales volumes in Japan. Through the deal Barry Callebaut will sell the product back to Morinago, as well as its Japanese "growing industrial and artisanal customer base"​. Deliveries of the product are expected to begin within the next 12 months, the company said. Both companies decided not to reveal any financial details. Barry Callebaut yesterday inaugurated its new manufacturing plant near Shanghai, China, and last year the company announced it was moving into India, as part of plans to increase the share of sales generated outside Western Europe and North America to 20 per cent by 2010 from 11 per cent presently. According to Global Business Insights, the Asia Pacific region is indeed one of the most promising regions for confectionery companies. Although Asian consumers account for only 17 per cent of global cocoa consumption, chocolate consumption in the region is currently increasing at a rate of 25 per cent a year, the market analysts said. The area region is also currently one of the hot spots for confectionery New Product Development (NPD). Just over 30 per cent of new confectionery products were launched in the area, second only to Europe, where just over 35 per cent of new products were launched, GBI said. In 2007, flavours popular for new confectionery launches in Asia including goji, salt, pomegranate and eucalyptus, said GBI analyst Helen Lewis. De Maeseneire said last year that Barry Callebaut is in fact particularly keen to focus on Japanese consumers' interest in functional products. "Japanese consumers particularly appreciate the health benefits of the cocoa bean and prefer premium chocolate with a high cocoa content, areas which are a great strength of ours,"​ he said.

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