Blog: Katy AskewWill Roshen be on the block now its owner is the Ukrainain president?

Katy Askew | 5 June 2014

Petro Poroshenko's ascent to the presidency of the Ukraine could see the world's 18th largest confectionery company put up for sale as the "candy king" turns his attention to the pressing issues of the day, like sweet-talking Russia.

In the run up to the presidential election, Poroshenko reportedly told German newspaper Bild that he would sell the business to "wipe the slate clean" and "focus on the well being of the nation" were he to win.

The seizure of Roshen's Russian assets during the election campaign would certainly stand as proof that mixing politics and business in a powder keg of political tension might not be a recipe for success.

Last month, the Ukrainian confectioner lost an appeal to overturn the Russian authorities move to freeze Roshen's Russian bank accounts following a trademark spat with part state-owned Russian firm United Confectioners. The total amount seized in cash equals RUB2.8bn (US$80.5m).

While Roshen is yet to confirm whether it will be sold, attention has turned to who could emerge as potential bidders.

Much speculation has focused on whether Mars or Nestle would be interested in strengthening their hand in a region where they are already leading players. Russian reports have also suggested a potential takeover by Orkla - but given the Norwegian firm's strategic evaluation of operations in the region this seems a less-than-likely outcome. Lotte Confectionery has also be touted as a potential suitor. And what of United Confectioners itself? Would the politics of the situation prove a boulder to the firm, which has previously indicated its intention to grow sales outside Russia?

What is clear is that operating in the volatile climate of eastern Europe offers both opportunity and risk to multinational confectionery groups. According to Mintel, a research firm, the market for confectionery in Eastern Europe increased at a compound annual growth rate of 6.2% between 2004 and 2009. But will the growth potential on offer be enough to assuage concerns over current political instability and an uncertain operating environment?

BLOG

Popularity a challenge and opportunity for US organic movement

Growing demand for organic foods in the US is propelling sales in the sector. Organic products are moving from their niche to gain mainstream traction. Penetration is high - more than 80% of families ...

NEWS

BRAZIL: Arla takes stake in dairy group Vigor

Arla Foods has acquired a stake in Brazilian dairy company Vigor Alimentos. ...

BLOG

How ABF is fighting back on sugar

The health story of 2014 has been the debate over the impact sugar has on obesity. The issue hit the headlines in January and has stayed there, with only yesterday a study published in the UK calling ...

BLOG

Asda goes all in on gluten-free pledge

With demand for gluten-free on the rise, retailers in a number of countries have been building ranges of products to capitalise on a significant growth spot in challenging trading conditions. In the U...

BLOG

International brands face stronger customer after Auchan, Systeme-U deal

France's fifth- and sixth-largest retailers, Auchan and Système U, are to team up on buying - with the companies to work together when dealing with international brands....

just-food homepage



Forgot your password?