Orkla sells Russian confectionery business to Slavyanka
Orkla offloads Russian confectionery brands
Orkla has entered into an agreement to offload its Russian confectionery business to Slavyanka-Lyuks, a member of Russian confectionery group Slavyanka, for an undisclosed sum.
The unit, Orkla Brands Russia, was created in 2011 when Orkla merged its SladCo and Krupskaya businesses. It includes the Krupskaya, SladCo and Pekar brands as well as production plants in Peterhof, Yekaterinburg and Ulyanovsk. In 2013, net sales totalled RUB6.1bn (US$116.5m).
"Orkla has executed a comprehensive restructuring in Orkla Brands Russia over the last couple of years. The company is now well positioned for the future, but we believe that other owners are better positioned to further develop and support the company's operations," said Peter Ruzicka, Orkla president and CEO.
Orkla's Russian branded nuts company, Chaka, and separate real estate assets in St Petersburg and Yekaterinburg are not part of the transaction. Separate sales processes have commenced for the real estate assets.
The deal is subject to Russian competition approval.
Orkla ASA: Orkla sells Orkla Brands Russia
Orkla has entered into an agreement to sell OJSC Orkla Brands Russia to Slavyanka-Lyuks JSC, a member of the Russian confectionery group Slavyanka. Under the agreement, Orkla will divest 100 per cent of its shares in Orkla Brands Russia.
Orkla Brands Russia is an established confectionery producer in Russia, with iconic local brands such as Krupskaya, SladCo and Pekar. The company was established in February 2011 through the merger of SladCo and Krupskaya, which have been part of Orkla since 2005 and 2006, respectively. Orkla Brands Russia has production plants in Peterhof outside St. Petersburg, Yekaterinburg and Ulyanovsk. In 2013, the company's net sales totalled RUB 6,114 million (NOK 1,129 million). As of year-end 2013, the company had 2,225 employees.
Orkla communicated in Q1 2014 that a structural sales process had been initiated.
"Orkla has executed a comprehensive restructuring in Orkla Brands Russia over the last couple of years. The company is now well positioned for the future, but we believe that other owners are better positioned to further develop and support the company's operations," says Peter A. Ruzicka, President and CEO of Orkla ASA.
The agreement is subject to approval by the Russian competition authorities.
Orkla's Russian branded nuts company, Chaka, and separate real estate assets in St. Petersburg and Yekaterinburg are not part of this transaction. Separate sales processes have been commenced for the real estate assets.
Renaissance Capital has acted as exclusive financial advisor to Orkla in this transaction.
Original source: Orkla
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