New owner for Shanghai confectioner

US-headquartered The Hershey Company has acquired 80 per cent stake in confectionery company Shanghai Golden Monkey Food Company.

Hershey Netherlands, a Hershey wholly-owned subsidiary, has paid 2.4 billion yuan (approximately $394 million) for the stake. The subsidiary will buy the remaining 20 per cent stake of SGM, at a second closing, which is scheduled to occur on the one-year anniversary of the initial close, at a price of 604.2 million yuan (approximately $98 million).

China is Hershey’s top priority international market for growth. The company has increased its investment in China over the past several years and is one of the fastest growing confectionery companies in China. Hershey expects net sales in China this year to top $200 million, an increase of about 40 per cent on 2013.

“This strategic acquisition advances our international growth agenda and builds on our commitment to the China market by providing world-class, quality products to Chinese consumers,” said Humberto Alfonso, president, Hershey International.

“We will leverage Shanghai Golden Monkey’s iconic brands, diverse product portfolio and strong sales force to build on the organic growth we delivered in China over the past several years.”

SGM has 10 sales regions supported by 15 sales branches with 130 sales offices throughout the country.

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