KUALA LUMPUR: The acquisition of Cocoaland Holdings Bhd (Cocoaland) will enable Fraser & Neave Holdings Bhd (F&N) to tap into a market segment worth RM4.2 billion.
In a statement, F&N said the acquisition of Cocoaland is a strategic move to realise the company’s long-term goal to expand into the packaged food segment and support the growth of its halal food pillar.
“With the completion, F&N looks forward to leveraging the strengths of both organisations to generate synergistic values for shareholders,” it said.
Cocoaland is Malaysia’s largest gummy candy producer, with its flagship Lot 100 brand.
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It is also an established contract manufacturer for local and multinational pharmaceutical customers.
F&N chief executive officer Lim Yew Hoe said the company had seen a vast potential to grow its share in this category, especially in the healthy and functional range.
Lim said F&N plans to build upon Cocoaland’s strengths and invest in the brands to introduce new portfolios such as plant-based and health & wellness products.
Meanwhile, Lim said Cocoaland brings many synergies to the company, with its product range having an identical route to market and consumption occasion as F&N’s current beverage and dairy products.
“Domestically, Cocoaland can leverage F&N’s expansive distribution network and procurement synergies.
“Cocoaland will also offer ample capacity for expansion with four manufacturing plants in Malaysia to support our existing business and future growth.
“For example, Sri Nona will utilise vacant factory space to increase its much-needed capacity for ketupat, and Cocoaland’s beverage line will produce more F&N products,” he said.
Despite supply chain disruptions and the rising cost of goods sold (COGS) facing the industry, Cocoaland has made a remarkable recovery compared to last year.
For its third quarter (Q3) ended September 30, 2022, Cocoaland recorded RM71.7 million in revenue, a 55.8 per cent year-on-year growth, while net profit surged to RM10.6 million from RM4.1 million a year earlier.
Cocoaland’s third-quarter results are aligned with F&N’s same-period performance for its Malaysia operations.
“The company’s long-term goal for Cocoaland is to build it into East Asia’s most recognised gummy manufacturer and a leading producer of chocolate products internationally.
“With our good relationship with Cocoaland’s management, we are optimistic about capturing future opportunities that will drive our expansion to other global and domestic markets,” Lim added.
Reference : https://www.nst.com.my/business/2022/11/854824/fn-leverage-cocoland-expand-packaged-food-segment