Orkla's FMCG focus leads to Rieber buy
The Norwegian conglomerate wants to be a "pure-play" FMCG business and this week it made its first major acquisition - a deal to snap up local food group Rieber & Son.
Orkla, the Norwegian conglomerate with interests in aluminium and finance as well as pizza and chocolate, wants to focus on consumer goods. This week, Orkla agreed to buy local food group Rieber & Son and, although analysts expressed misgivings at the price it paid, they believe it is a sensible move from the company. Dean Best reports.
Orkla CEO Åge Korsvold today (20 August) defended Rieber & Søn's recent performance as the Norwegian conglomerate announced a deal to buy the local food group, which has had a challenging 18 months.
Norwegian conglomerate Orkla, which is reshaping its business to focus on consumer goods, is to buy local food group Rieber & Søn.
Norwegian food manufacturer Rieber & Søn today (12 July) reported lower half-year sales and profits, blaming low consumer confidence in Europe.
Seven months ago, Orkla CEO Bjørn Wiggen announced the Norwegian conglomerate would focus on the FMCG sector, earning praise from analysts in the process. This week, Orkla stunned the market with news that Wiggen had decided to resign. Eyebrows were raised further yesterday when it emerged the boss of Orkla's FMCG unit would also leave the business. Industry watchers believe the departures will not mean a change in direction but could suggest Orkla's owners were frustrated with the slow progress of the company's new strategy.
Norwegian food group Rieber & Søn has posted a drop in full-year profits, hurt by a one-off cost related to job cuts during the year.
Norwegian conglomerate Orkla has revealed it plans to focus on branded goods and will use acquisitions to build its business in the sector.
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