Contrary to a media report in Sweden, Orkla has denied the Nordic food group has started a sales process for its ingredients division.
A potential sale of Orkla Food Ingredients (OFI) would fit within the framework revealed by president and CEO Nils Selte in October, when he announced a reorganisation into 12 business units, along with potential “acquisitions, joint ventures, stock-market listings and divestments of companies”.
However, a spokesperson for Norway-headquartered Orkla told Just Food the company has “not started a structured sales process of Orkla Food Ingredients” but suggested the business might seek a partner.
Last week, Swedish business newspaper Affärsvärlden said Orkla had hired advisors to explore a sale of the division.
Contacted by Just Food, the Orkla spokesperson referred this publication to comments made in a statement by Selte in October, when the company revealed it had acquired an 84% stake in US-based ice-cream ingredients supplier Denali Ingredients for US$200m.
“The food ingredients sector is fragmented with significant potential for further consolidation and growth. Based on these opportunities, we will now initiate a process to seek a long-term partner for OFI to accelerate growth and value creation,” Selte said in that statement.
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Before unveiling the new business set-up in October, Selte had said in July he would conduct an “analysis” of the Orkla organisation after he joined the business from Canica, the Oslo-based investment group that holds 25% of the food firm, its largest shareholder.
Selte explained in his 27 October statement: “We will adopt a long-term, industrial approach to the portfolio companies as active owners and will work through the company boards. We will continue to build on the deep consumer insight and experience that we have acquired in developing leading brands.
“At the same time, we will pursue an active portfolio management policy, targeting rapidly growing consumer segments and markets.”
From the 1 March, the business will be structured along the divisions of: Orkla Foods Europe; Orkla Food Ingredients; Orkla Confectionery and Snacks; Orkla India; and Pizza Out of Home.
Completing the line-up are the industrial business Jotun; Orkla Health; Orkla Home and Personal Care; Orkla House Care; the Health and Sports Nutrition Group; Pierre Robert Group; and Lilleborg.