Mikael Neglen, president of Barry Callebauts Asia Pacific chocolate arm, and GarudaFood CEO Hardianto Atmadja announce agreement

Mikael Neglen, president of Barry Callebaut's Asia Pacific chocolate arm, and GarudaFood CEO Hardianto Atmadja announce agreement

Indonesia-based snacks and confectionery maker GarudaFood is to outsource some chocolate production with business-to-business supplier Barry Callebaut.

The company has struck a deal that will see Barry Callebaut supply 10,000 tonnes of compound chocolate a year to the group's biscuit factory in Gresik in East Java.

The two sides also said there would be "close co-operation" on innovation. "Through joint R&D activities the two companies will develop new products that will support GarudaFood’s further growth in the Indonesian market," a joint statement published today (16 June) read.

Under the terms of the outsourcing agreement, Barry Callebaut will take over some manufacturing equipment from GarudaFood and set up operations in a new factory building on the premises of plant in Gresik.

Hardianto Atmadja, CEO of GarudaFood, said he was "truly excited" about what the companies described as a long-term deal. "I believe it will provide and delight our consumers with the best chocolate and products that meet global quality standards."

Outgoing Barry Callebaut CEO Juergen Steinemann said the agreement was the Swiss giant's first in south-east Asia. In 2012, Barry Callebaut significantly expanded its operations in the region with the acquisition of Petra Foods' cocoa ingredients arm.

Steinemann said: "This partnership marks our entry with chocolate and compound production in Indonesia, the world’s fourth largest country with a population of 250 million and impressive growth rates. Partnering with the GarudaFood Group not only allows us to team up with a leader in one of the most vibrant economies in Asia Pacific but also to gain a strategic foothold in an emerging market that offers further significant growth potential."

Steinemann moves from CEO to vice chairman in October. Antoine de Saint-Affrique, the president of Unilever's foods business, will replace him as chief executive.