SWEDEN: Candyking abandons float, CEO quits
CandyKing CEO has stepped down as the company continues to operate privately
Nordic confectioner Candyking will remain private following a decision at the end of last year to abandon its planned IPO.
Speaking to just-food, Candyking chairman Jan Ohlsson said that the company had sought alternate ways to raise finance and no longer intends to float the business.
Candyking announced last week that it has secured long-term financing through a bond issue that raised SEK750m (US$116m). The four-year senior secured high yield bond matures in January 2018, the company said.
Candyking added that the move was "well received" by the market, with "strong demand" from "all Nordic countries". Seventeen investors participated and, according to a statement from the company, 60% of subscriptions were placed by non-Swedish investors.
In December last year, the company put a hold on plans for an IPO after media coverage of fires at supplier warehouses were thought to spook would-be investors.
Ohlsson told just-food that the company received news of the fires at a "very late stage" in the IPO process. Candyking offered shareholders the opportunity to pull out if they wished and, following an "intense media storm", Ohlsson decided it would be best to put the company's plans to list on hold.
"To turn the company out to an IPO with this current uphill battle was not fair for the management team so we decided to pull back and perhaps revisit at a later time," he explained.
Nevertheless, Candyking was still saddled with a negative capital structure which Ohlsson said he "had to address". The best way to do that was through a bond issue, he insisted.
"I am very happy - the bond was oversubscribed. It proves Candyking's reputation in the market is still quite strong.
"Through the issuance of the bond, Candyking achieves a more efficient and flexible capital structure and secures financing for continued growth. The transaction empowers the company to enhance its position as the clear market leader in the pick and mix confectionery and natural snacks industry."
However, the move opened a rift in Candyking's senior management and CEO David von Laskowski resigned in response to the decision.
"Since Candyking will continue to operate in a private environment, I have decided to leave the company,” von Laskowski commented. He will continue as CEO until a replacement is found.
Ohlsson said Candyking would continue to focus on growth plans and in particular would look to boost its presence in shops, particularly for its natural snacks range. Last year Scandanavian home giant IKEA signed as a customer, which Ohlsson said was a "great ticket for us" and would allow Candyking to establish a wider regional presence.
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