Mondelez International seeks a major stake of the Vietnamese confectionery company to access markets and distribution channels.
Mondelez International has offered $370 million for an 80 per cent stake in Kinh Do’s snack business, in order to foster its expansion into new emerging markets.
The purchase has not been completed as yet as it requires approval from regulators and Kinh Do shareholders, with a vote of shareholders to be taken on December 1. Mondelez is confident about its offer and has confirmed it may seek to purchase the remaining 20 per cent within a year of the initial acquisition.
The deal will not only give Mondelez control of Kinh Do’s top-selling brands such as Kinh Do Moon Cakes and AFC crackers but also power over its complete distribution network in Vietnam. The network is expected to help Mondelez expands their business scale, which was described as “rather small” by its Executive Vice President Tim Cofer, by improving sales of Ritz crackers and Oreo cookies.
Kinh Do is currently restructuring its snacks business before the acquisition is finalized. Like Mondolez, Kinh Do leaders are optimistic about the opportunities the deal may bring. “We are proud to be able to bring Kinh Do to the next level of growth and to offer new tastes to consumers, not only in Vietnam but the world,” Mr. Tran Kim Thanh, Chairman of Kinh Do, was quoted as saying. If approved by the shareholder vote in December, the deal is expected to be wrapped up before the third quarter of 2015.
- Kinh Do
- Tran Kim Thanh