NEW YORK (The Deal) -- Swiss chocolate maker Lindt & Sprungli expects to increase its North American revenue by about 50% through the purchase of privately held Russell Stover Candies, the No. 3 in that market.
Lindt declined to say how much it is paying for the Kansas City-based company, though Lindt Chairman and CEO Ernst Tanner said the price was "not less than $1 billion." The transaction resulted from a review by Russell Stover's shareholders, the Ward family, which led to about two months of talks between the two sides, he said.
Russell Stover had sales in its last financial year of about $500 million. Lindt on Monday, July 14, said the purchase will take its own North American revenue to more than $1.5 billion in 2015 and "make a strong positive contribution to the earnings per share from 2015 onwards." Tanner said Lindt expects to expand Russell Stover primarily in North America, which was the second-fastest growing of Lindt's major markets in 2013, with sales up 11.4%.
"This is an American iconic brand and its products more focused on American tastes," said Tanner. "Our international brand will remain Lindt."
Lindt may follow up the acquisition, the Swiss company's biggest ever, with additional purchases, he said.
"Whatever is available in the market for premium chocolate, if we can manage it, we will have a close look at it as we can certainly afford more acquisitions from a financial point of view," he said.
Lindt had net cash of Sfr724 million ($812.7 million) at year-end.