German biscuit merger

Eurofood, Feb 11, 1999

German biscuit makers Griesson and De Beukelaer Germany/Austria have announced they are to merge, thus creating a new group with turnover worth more than DM500m (??256m). Griesson will retain a controlling 60% stake of the new company, which will payroll 1 200 employees.

The new company will be known as Griesson-de Beukelaer, and will be headquartered in Polch, near Koblenz, which is where Griesson's head office is located. It will be headed up by current Griesson managing director Heinz Gries and former De Beukelaer boss Andreas Land, who started working for Griesson last year. De Beukelaer is a subsidiary of leading French food group Danone, which also owns distribution rights to brands such as De Beukelaer, LU or Tuc outside Germany and Austria. Gries and Land emphasised that the merger terms do not contain any additional agreement with options for a future majority acquisition. Once the merger is complete, which is slated for 1 March 1999, Gries and Land hope to exploit synergies within the new group. It is highly likely that this will see the two sales and distribution teams merged. Management-level personnel decisions have yet to be taken -- for example, it is not clear what role current De Beukelaer managing director will take on.

HEAVY INVESTMENT PLANS

Griesson-De Beukelaer owns production sites in Polch, Kahla (in Thuringia) and Kempen, which is where the famous Prinzenrollen biscuits are made. The group expects to spend DM30m on upgrading and expanding its manufacturing facilities, which is being interpreted as a clear sign of ambition for growth Griesson is bringing DM244m annual turnover to the merger, while De Beukelaer's slightly smaller contribution is DM240m.