FDBusiness.com

Italian confectionery giant Ferrero Group is acquiring Thorntons, the UK chocolate manufacturer and retailer, for £111.9 million. Ferrero has made a recommended cash offer of 145p for each Thorntons share.

Established in 1911, Thorntons is an established and historic chocolate brand in the UK, operating across both retail and FMCG categories. It currently has 242 own stores and cafes across the UK and Ireland and a franchise estate of 158 outlets. Thorntons operates a manufacturing facility in Alfreton, Derbyshire, where it employs around 1,500 of its approximately 3,500 workforce.

Thorntons reported revenues of £222.4 million and operating profit of £8.6 million for the year ended 28 June 2014. Around 3% group revenues are currently generated overseas. Thorntons has been listed on the London Stock Exchange since 1988.

Paul Wilkinson, chairman of Thorntons, comments: “Ferrero is offering our shareholders an attractive premium to the average price of Thorntons’ shares over the last three months. Although the prospects for Thorntons as an independent company remain strong as the company embarks on the next phase of its strategy, the board of Thorntons also recognises the potential benefits to the brand and the business, including employees and all stakeholders from combining with the Ferrero Group. Ferrero is a successful global confectionery business with a strong family heritage and as such represents a good cultural fit for Thorntons. The board of Thorntons therefore has given its unanimous recommendation for the offer from Ferrero.”

Ferrero already has an established presence in the United Kingdom and has operated in the market since 1966.

Giovanni Ferrero, chief executive of Ferrero, says: “We delivered our best ever results in the UK in 2014, giving us confidence that now is the right time to broaden our roots in this important market. This transactions brings together two highly complementary businesses, but more importantly it unites two companies that share the same passion for growing brands, and a proud heritage, drive and culture built upon their family foundations. We have long admired Thortons and what they have achieved in the UK as demonstrated by their tremendous customer loyalty, and we look forward to working with their experienced team.”

The Ferrero Group is a leading global manufacturer of branded chocolate and confectionery products which are present in over 160 countries. Ferrero is the manufacturer of a range of products including its well-known “Ferrero Rocher”,“Kinder”, “Nutella” and “Tic Tac” brands. The Ferrero Group reported annual turnover of €8.4 billion for the year ended 31 August 2014 and employs approximately 27,000 people.