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Ferrero gobbles up Nestle’s US confectionery business for $2.8 billion

Nestle said on Tuesday it has agreed to sell its US candy business to Italy's Ferrero for CHF 2.7 billion ($2.8 billion/2.3 billion euros) in cash as the Swiss food giant shakes up its product portfolio.

Ferrero gobbles up Nestle's US confectionery business for $2.8 billion
Nestle Butterfinger and Butterfinger Cups on a shop shelf. Photo: Joe Raedle/Getty Images/AFP

Ferrero, known for its Tic Tac, Nutella and Ferrero Rocher brands but which has traditionally preferred organic growth to acquisitions, will now be picking up Crunch, Butterfinger and Baby Ruth from Nestle. The sale will make Ferrero the third-largest confectionary company in the US market.

According to media reports, Ferrero competed with major chocolate manufacturer Hershey and private funds, including Rhone Capital, to secure the deal. Executive chairman Giovanni Ferrero said that after the acquisition the Ferrero Group “will have substantially greater scale, a broader offering of high-quality products to customers…” in the United States, the world's largest confectionery market.

READ ALSO: The curious story behind Italy's world-famous Nutella spread Nutella owner Ferrero dies aged 89
Photo: AFP

Nestle's chief executive Mark Schneider said the deal “allows Nestle to invest and innovate across a range of categories where we see strong future growth and hold leadership positions, such as pet care, bottled water, coffee, frozen meals and infant nutrition.

$8 billion market

Nestle has begun to reposition itself since Schneider, who previously headed up German healthcare group Fresenius, took over the reins of the Swiss firm at the start of last year. It has snapped up companies that make vegetarian meals, vitamins and luxury coffee.

Its US candy business registered sales of some 900 million Swiss francs in 2016, in a market worth an overall $8 billion, according to Ibis World. The figure only represented around three percent of its overall US sales, Nestle said.

READ ALSO: Nutella maker's widow is now world's richest Italian

The company added it remains fully committed to growing its leading international confectionery activities around the world, particularly its global brand KitKat.

The family-run Ferrero businesses has 22 production sites and 30,000 employees. In ten years the company has more than doubled its turnover, to more than 10 billion euros.

Since 2014 it has acquired the Turkish group Oltan, specializing in hazelnuts, and the British chocolatier Thorntons before starting its offensive in the US. The deal is expected to be finalized by the end of March, Nestle added.

DISCOVER ITALY

Why some of Italy’s food festivals are ‘fake’ – and how to pick the best ones

Italy's countless sagre, or food fairs, are an autumn highlight. But how do you find the best events - and avoid the more commercial ones? Reporter Silvia Marchetti explains.

Why some of Italy’s food festivals are 'fake' - and how to pick the best ones

Italy’s renowned food fairs are one of the most exciting events during autumn and winter, particularly the coldest months when we’re looking for culinary weekend distractions. 

For the uninitiated, sagre are key gourmand exhibitions mixing local food, premium products, cheeses and olive oil – all the ‘excellences’ of the area – but lately I find some are just, well, fake. 

READ ALSO: The best Italian food festivals to visit in October

Instead of selling traditional indigenous delicacies, vendors sell a little bit of everything which they think appeals to foreigners and city people desperate for a rural break. 

Last weekend I went to the sagra at Osteria Nuova, near Passo Corese in Lazio, and found mozzarella from Naples and limoncello from Amalfi: now what do those have to do with the Rieti countryside?

It was sad and disappointing. Even though it takes place in an area which is famous at this time of the year for exquisite porcini mushrooms and chestnuts there was not even one single vendor selling these. Instead, there was codfish from Venice and porchetta from the Castelli Romani.

Up until a few years ago the Osteria Nuova food fair was very genuine and appealing: it was actually a real farmers’ market where animals were sold: not just rabbits and hens but cows, horses and donkeys. It was a vibrant event. 

Now the cages that once kept the animals are empty. And people just go there to stuff themselves with huge sandwiches and hotdogs. It’s always hell finding a parking spot because the fair is very close to Rome, luring day trippers on a ‘scampagnata’.

Photo by Tobias SCHWARZ / AFP

My advice is to avoid visiting food fairs which are too close to big cities and towns, but pick offbeat villages or unknown rural spots where the sagre are small and with local producers selling authentic, ‘indigenous’ products. Choosing the remote hillsides, where traditions tend to survive, is of course better than the touristy areas. 

READ ALSO: Seven reasons autumn is the best time to visit Italy

Also, it’s best if the food fair is not too heavily sponsored or advertised in national newspapers. The best thing to do is search online for all food fairs in the area you plan to visit during the weekend or even during the week, and ask friends and locals as word of mouth can often be more reliable. 

Among the authentic sagre I would recommend the porcini mushroom food fair in San Martino al Cimino in the pristine hills of the Tuscia countryside in Lazio, where the woods are dotted with porcini. 

At the fair not only bags of huge porcini are sold but you can also buy a lunch ticket and taste various mushroom dishes sitting down at wooden tables. Last time I was served a delicious potato and porcini soup which inspired me to replicate (successfully) the recipe at home. 

However, the best thing is to search for the weird and unknown – food fairs with funny names and showcasing products that sound and look really bizarre. So forget about the usual truffles, mozzarella, limoncello, ham and pasta-filled events. I suggest opting for quirky food festivals in never-heard-of-before villages where the culinary adventure comes with a cultural jolt. 

Photo by MARCO BERTORELLO / AFP

When I hear about something amazingly off-the-wall and tasty, with a particular story or legend behind it, my curiosity and taste buds tingle.

Last weekend I was surfing the web and came across the Ciammellocco festival in the tiny hamlet of Cretone, Lazio, which immediately aroused my curiosity. 

READ ALSO: 14 reasons why Lazio should be your next Italian holiday destination

As I had never heard of it before, I jumped in the car the following day and ventured out to an isolated woody area with a few small dwellings, where one single bakery makes this huge, funny-sounding, highly-nutritious sweet-salty doughnut with fennel seeds which has been around since at least the middle ages. Housewives used to make it for their husbands as a substitute for lunch when they went off working in the fields. 

Even though I have tasted similar ciambelle in my life none come close to ciammellocco, crunchy and tender at the same time, made with eggs but light.

Next I heard about the Sagra della Papera in Carassai, Marche region, offering succulent duck meat dishes with pappardelle pasta and roasted duck breasts, and given duck isn’t something you’d normally find in Italian restaurants, it makes the cut for authentic food events. 

Vegetarians can’t miss the Festival degli Orapi in the village of Picinisco north of Naples where guests are treated to platefuls of a unique, delicious spinach variety which is made exquisite by the fact that it grows beneath goat poo, a natural fertilizer. Locals actually roam the countryside with a knife to scrape away the poo and extract the orapi.

In Pedagaggi, Sicily, local housewives organize the Sagra della mostarda di fichi d’india, with gourmet dishes made from exotic-looking prickly pear mustards. 

READ ALSO: ‘La scampagnata’: What it is and how to do it the Italian way

Other curious sagre include the Festa del Gorgonzola set in the town of Gorgonzola in Lombardy which is the real birthplace of Italy’s iconic blue cheese. Huge pentoloni of steaming pots of gorgonzola in the middle of the piazza lure pungent cheese addicts. 

Also Diamante’s festival del peperoncino in Calabria is a must stop for lovers of strong, authentic hot dishes spiced up with chili peppers (there’s even a peperoncini eating marathon).

Real sagre tend to showcase one premium native product rather than a myriad with overlapping origins.

The more ‘local’ you dive into the deepest, remote corners of Italy full of tradition and folklore, the more genuine the sagra and the more satisfying the gastronomical experience.

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