Ferrero is close to a major breakthrough on the American market, by buying Nestlé’s US chocolate bar business, which includes the popular Crunch. The $2bn operation would see Ferrero become the third biggest confectionery business in the States, after Hershey and Mars. According to indiscretions reported by the New York Post, Ferrero is poised to win the US auction of Nestlé brands, after Hershey, its biggest rival, looks set to withdraw from the contest as a result of agreeing this week to buy Amplify, the maker of Skinny Pop popcorn, for $1.6bn. The only other competitor still in the running for the Crunch and Butterfinger bars is a small private equity group, but it is not tipped to win the deal.
For Ferrero, the purchase would represent a real coup in the United States, where in recent months it has seen important growth with the buyout of Ferrara Candy, known for Trolli gums, Halloween favourite Brach’s and Black Forest Organic fruit sweets. Nestlé is expected to announce the auction winner early in the new year, and aims to sell its division by the end of March. Nestlé had announced that it wanted to sell its confectionery division in the United States in June, as part of a review of the company’s product portfolio to better respond to the ‘healthier’ demands of American consumers. By freeing up its confectionery business, Nestlé in the US could focus on the more growth-intensive sectors of coffee, pet food and water. Nestlé has tried on several occasions to revive its activities in the US, selling off brands such as Juicy Juice and PowerBar. Its reorganization has seen it bring home major successes, with DiGiorno pizza, Haagen-Dazs ice cream and Lean Cuisine frozen foods.