Spain-based confectioner Lacasa is to invest in Côte d’Ivoire cocoa processor KKO International.

Family-owned Lacasa is buying a 22.3% stake in the France-listed business, the companies said yesterday (20 April).

Alongside the investment, the businesses are to set up a joint venture to make chocolate products in Côte d’Ivoire.

Under the terms of the deal, Lacasa is subscribing to a capital increase by KKO International worth just under €4.7m ($5.5m). Lacasa is paying €2.2m in cash and the rest by offsetting existing receivables.

Lacasa CEO Fernando Lacasa Echeverria said the plan to invest in KKO International was “in line with the long-term strategic direction of our family business”.

In the statement, the companies said the KKO International board would be “composed primarily” of Lacasa representatives.

Lacasa Echeverria added: “We know KKO International well through established operational relationships and have been able to appreciate the quality of its teams as well as its position at the heart of the cocoa sector. We are convinced of the value creation potential of this partnership and intend to play an active and constructive role in the group’s governance, respecting its identity and ambitions.”

The companies said Lacasa’s investment would “strengthen” KKO International’s “financial structure” and “consolidate upstream-downstream synergies in the cocoa and chocolate sector”.

In October, KKO International posted first-half revenue of €9.5m, more than double that of a year earlier and already more than the €9.3m the company generated in its previous full financial year. It pointed to higher volumes and the ramp-up of its Shokko processing plant.

However, higher cocoa-bean prices, plus logistics and energy costs, weighed on profits in the six months to the end of June. Operating profit reached €1.2m, versus €1.7m a year earlier.

The businesses are planning to form a venture between Lacasa and KKO International subsidiary Shokko to “develop the production of finished chocolate products” in Côte d’Ivoire. Just Food has asked KKO International for further details on the plans for the venture.

Lacasa has five factories in Spain, as well as commercial arms in Portugal, France and Argentina.

In the statement, KKO International president Jacques-Antoine de Geffrier said: “This is a major step in the transformation of the KKO International group, which is getting both a solid industrial partner, strengthened financial resources and an increased capacity to deploy its long-term strategy.”