21 February 2002 - Cadbury Schweppes plc announced today that it has agreed to acquire a minimum 51% equity interest in Kent, Turkey's leading sugar confectionery manufacturer, together with a majority equity interest in its distribution arm, Birlik, from the Tahincioglu family for a consideration of £67 million ($95 million) cash and assumed debt.
Founded in 1956 by the Tahincioglu family, Kent is the largest sugar confectionery manufacturer in Turkey. It has the leading share of the packaged sugar confectionery market (66%) and the second largest share in the chewing gum market (14%). Additionally, Kent currently exports to 66 countries embracing the Turkic nations, the Middle East, Balkans and the CIS/Russia. Exports represent approximately a third of volumes. Birlik has an extensive, nationwide distribution network reaching 115,000 points of sale.
The total Turkish confectionery market is valued at £634 million ($900 million) with the sugar segment accounting for 34%.
Under the Kent brand umbrella, Kent offers a high quality, differentiated range of standard and functional sugar confectionery products that enjoy awareness levels of nearly 100%. Kent is well regarded by consumers as offering traditional yet contemporary and innovative confectionery. Well-known sugar brands include Olips, Jelibon, Elegan, Missbon, Tofita, Topi Top, Olite and Bonibon. Kent has the second position in the Turkish gum market with brands such as Relax, Nazar, Turbo and Minti.
Kent operates a state-of-the art manufacturing plant, with strong R&D capability, near Istanbul and employs 1000 people.
"Partnership with Kent provides a strong platform in a key emerging market with direct links to adjacent regions where we successfully operate such as Africa, the Middle East and Russia, " said John Sunderland, CEO of Cadbury Schweppes. "Both companies' operations and expertise are complementary and provide Cadbury Schweppes access to potential high rates of growth in Turkey and the Turkic nations," he added.
Yakup Tahincioglu, Chairman of the Kent Board, said his company was attracted to Cadbury Schweppes because of its management expertise and the access it gives to Cadbury Schweppes' worldwide confectionery business. "Cadbury Schweppes' strong management, brand expertise and global route to market gave us the confidence to take this major step", Mr Tahincioglu added.
The transaction will be funded from Cadbury Schweppes' existing debt facilities and is expected to close in the second quarter of 2002, subject to regulatory approval.