As I slowly climbed out of my holiday hibernation yesterday morning, a bit reluctant to leave the warmth of home and hearth and embrace the first frigid, really frigid work day this year — and we’re talking -7° (21.6° C for my international readers) — I was, nonetheless, a bit curious what had happened during the time I was enjoying family, friends and feasting.
OK, so I wasn’t totally off the grid, but there were so many distractions that focus proved difficult. After all, when you’re busy building LEGO helicopters with a six-year-old as well as keeping a 15-month-old distracted so he won’t cry for his mother, checking e-mails gets put on the back burner.
Thus, yesterday was the day to get up to speed. One of the first missed headlines I came across involved the Colian Group, a company I had visited last year in October. Headquartered in Opatówek, Poland, the largest Polish-owned confectionery company posted €137.5 million ($165.2 million) in sales in 2016.
Ongoing investments and targeted acquisitions had caught the eye of the European Candy Kettle Club — our Candy Industry Kettle Committee equivalent across the pond — who, in turn, nominated Jan Kolański, president of the Colian Group, for the coveted ECKC award in 2017.
As it so happens, Jan Kolański and the Colian Group are our January 2018 cover story. The reason I bring all this up is that the headline I was referring to earlier focused on the Colian Group acquiring Lily O’Brien’s, from the Carlyle Group for €40 million on Dec. 22.
This acquisition comes on the heels of the Colian Group picking up Elizabeth Shaw in 2015 from the Norwegian fund AS. During my interview with Kolański, he specifically referred to having a blue ocean strategy, one whereby he could make a splash in the marketplace without having to worry about too many mean and nasty sharks circling his company.
When I asked him about future acquisitions, he coyly demurred. Now I don’t know whether the makings of a deal where in progress then or not. Chances are they were. This most recent move, coupled with Kolański’s acquisition of Elizabeth Shaw earlier, provides Colian with not only access to the U.K. and Irish markets, but a pipeline to Australian and U.S. markets as well.
The deal will be consummated this month, but I sense it’s only the beginning of many more such moves by midsized and larger companies anxious to zero in on top-notch confectionery producers who lack the resources and scope to reach that ever elusive “next level.”
I’ve seen how Katjes International has used this strategy to its benefit as well. That was underscored with a gift I received yesterday, a bar of Sperlari nougat that’s typically given during Christmas time in Italy.
Until July of this year, Italian wasn’t spoken much at the company headquarters in Emmerich, Germany. Tobias Bachmüller, co-managing partner of Katjes International, laid out the company’s plan clearly in a press release upon making the acquisition. "As the fourth largest market in Western Europe, Italy was always the focus of our efforts to expand our strong market position,” he said. “With the acquisition of the No. 2 in Italy and its established brands, we have made a significant step towards further growth."
Granted, this strategy doesn’t work for everyone. But even mega-nationals, such as Nestlé, understand that focusing resources for maximum impact keeps shareholders happy. As we await to hear the winner of the bidding war for Nestlé’s U.S. confectionery business, keep in mind that there are many other groups trolling the waters for blue ocean opportunities, confectionery companies as well as equity funds.
I expect 2018 will be one heck of a year for hauling in catches large and small.