Cloetta to acquire dry roasted nuts maker Nutisal

Swedish confectioner Cloetta has signed a deal to take over dry roasted nuts producer Alrifai Nutisal to broaden its product portfolio within Munchy Moments.

Established in 2007, Alrifai Nutisal produces and sells dry roasted nuts under the Nutisal brand.

With approximately 60 employees, the company primarily caters to the branded bags segment and has annual sales of around SEK200m.

Nutisal is sold in Denmark, Norway, Germany, UK and the Benelux countries, and holds a leading position in the Swedish branded nuts market.

As per the deal, Cloetta agreed to pay the upfront purchase price of SEK110m in cash with potential future payments of up to SEK300m based on Nutisal’s targets for 2016.

The company said that the acquisition will support profitable growth with presence in adjacent categories, while generating only limited synergies within existing sales, administration and logistics.

Cloetta plans to fund the transaction through its existing credit facilities.

Scheduled for completion by early January 2014, the deal will have a very limited effect on Cloetta’s operating profit as the company is in a growth phase and is expected to be EPS accretive in 2015.

It is expected to generate sales growth of about 1% in the next few years, and will require restructuring costs of approximately SEK10m in 2014.

Cloetta CEO Bengt Baron said that the company will now be able to offer consumers a new Munchy Moment with an established brand in the growing nuts segment.

"Cloetta’s strong route to market combined with the market growth in the category should facilitate significant growth going forward," Baron said.

Alrifai Nutisal is being sold by Arval Holding, a company owned by Lebanese nuts producer Al Rifai Group.

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Image: Alrifai Nutisal produces and sells dry roasted nuts under the Nutisal brand. Photo courtesy of Cloetta AB.