Emmi is focusing more on emerging markets

Emmi is focusing more on emerging markets

Swiss dairy group Emmi has struck a deal to buy 50% of Mexideli 2000 Holding, an importer of cheese and fresh products into Mexico.

Emmi described Mexideli as "Mexico's leading importer of speciality cheeses". The company also imports a range of chilled products including desserts made by Emmi's Italian subsidiary A-27. Mexideli generates annual sales of CHF45m (US$49.9m), Emmi said.

Urs Riedener, Emmi's CEO, said: "Mexideli is a healthy and profitable company that has already been distributing Emmi products successfully for many years. Its leading position strengthens our opportunities in Mexico, a country that imports a lot of its cheese. The Emmi products set to benefit are its Swiss export cheese varieties, Swiss fondue, cheeses manufactured locally abroad and the desserts of the Italian producer A-27."

Emmi said around a quarter of the 400,000 tonnes of cheese consumed in Mexico was imported. The market for imported cheese in the country is growing at a "mid-single digit" rate a year, the company said, with sales of "premium, speciality cheeses ... posting double-digit growth".

The deal, struck for an undisclosed sum, is Emmi's latest acquisition or investment overseas as it looks to build a business that generates 50% of its sales outside Switzerland. At present, 43% of Emmi's revenue comes from overseas markets.

A fortnight ago, Emmi announced it had bought a 25% stake in US-based yoghurt firm Siggi's. The deal, struck for an undisclosed sum, was Emmi's fourth acquisition in the US in five years.

In July, Emmi bolstered its business in Italy with the acquisition of Italian dessert maker Rachelli.

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International growth

Emmi acquires stake in Mexico’s Mexideli

Lucerne, 3 January 2014 – Emmi is to acquire a 50% stake in Mexideli 2000 Holding SA de CV, which is headquartered in Mexico City. The company is Mexico’s leading importer of speciality cheeses. With this transaction, Emmi is strengthening its presence in Latin America and moving ahead with its programme of international growth.

Emmi’s strategy is to increase, over the medium term, the share of sales attributable to international business to 50%. The share currently stands at around 43%. The aim is to achieve this growth both organically and through acquisitions, with a stronger focus in future on emerging markets outside Europe.

With the 50% stake in Mexideli 2000 Holding SA de CV (Mexideli), Emmi is strengthening its position in an attractive, growing market and increasing the potential for exporting Emmi Group products to Mexico. This gives the company a second strong base in Latin America alongside Chile.

Emmi’s CEO Urs Riedener commented: "Mexideli is a healthy and profitable company that has already been distributing Emmi products successfully for many years. Its leading position strengthens our opportunities in Mexico, a country that imports a lot of its cheese. The Emmi products set to benefit are its Swiss export cheese varieties, Swiss fondue, cheeses manufactured locally abroad and the desserts of the Italian producer A-27."

Number 1 position in Mexico

Mexideli is a very well established company with a state-of-the-art logistics infrastructure spread across six locations in Mexico. It is Mexico’s leading importer of high quality speciality cheeses and also distributes speciality fresh products such as desserts, including those of the Emmi Group company A-27. The company has been operating successfully in the market for some 25 years and will generate sales of CHF 45 million (around USD 50 million) in 2013.

Mexideli has performed extremely well over the past few years, recording double-digit growth. The company offers the imported products to supermarkets with affluent consumers. The second, albeit smaller, pillar of its business is the food service sector, with a Mexideli subsidiary being the market leader in Cancún. Mexideli employs 250 people.

The Mexican cheese market

Around a quarter or some 400,000 tonnes of the cheese consumed in Mexico is imported, meaning that import expertise is vital. The cheese import market is growing at an annual rate in the mid-single digits, while imports of premium speciality cheeses are posting double-digit growth.

The parties have agreed not to disclose the purchase price or any other details of the contract.

Original source: Emmi