Mondelez International on Wednesday announced an agreement for the acquisition of Chipita, a leader in the bakery product and snack sector in central and eastern Europe, for around $2 billion.
Chipita was founded in Greece 40 years ago. It reported revenue of $580 million in 2020 and its product portfolio includes several brand names such as 7Days, Chipicao and Fineti.
“We welcome Chipita’s products in the Mondelez International family that will help us become a global leader in the snack business,” Dirk Van de Put, chairman and CEO in Mondelez International said in a statement.
“Chipita’s emblematic brands and its significant presence in so many attractive markets are a strong strategic addition to our portfolio and our future ambitions for development in Europe and beyond,” he added.
Mondelez is an American multinational confectionery, food and beverage and snack food company based in Chicago, Illinois.
Spyros Theodoropoulos, Chipita’s CEO, said, “I am certain that the acquisition by Mondelez International will create new prospects for Chipita’s people and its products.”
Chipita’s products are produced in 13 factories and distributed to more than 50 countries, a consumer market of nearly 2 billion people.
Mondelez International said the acquisition was financed through a combination of new debt and existing cash and added that the transaction will contribute to the direct increase of earnings per share.
Competition authorities need to approve the transaction, which does not include P.G. Nikas ABEE and Chipita’s minority stakes in a joint venture in India.
Mondelez has an annual revenue of about $26 billion and operates in approximately 160 countries. It ranked No. 117 in the 2018 Fortune 500 list of the largest United States corporations by total revenue.
The history of Mondelez International
The company has its origins as Kraft Foods which was founded in 1923 in Chicago. The present enterprise, was established in 2012 when Kraft spun off the grocery, and snack food businesses, with the latter adopting the name Mondelez, as proposed by its employees.
The name is derived from the Latin word mundus (“world”) and delez, a fanciful modification of the word “delicious.”
In September 2017, an investigation conducted by NGO Mighty Earth found that a large amount of the cocoa used in chocolate produced by Mondelez and other major chocolate companies was grown illegally in national parks and other protected areas in Ivory Coast and Ghana, the world’s two largest cocoa producers.
In 2021, Mondelez International was named in a class action lawsuit filed by eight former child slaves from Mali who allege that the company aided and abetted their enslavement on cocoa plantations in Ivory Coast.
The suit accused Mondelez (along with Nestlé, Cargill, Mars, Olam International, The Hershey Company, and Barry Callebaut) of knowingly engaging in forced labor, and the plaintiffs sought damages for unjust enrichment, negligent supervision, and intentional infliction of emotional distress.