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When Nestlé spent US$1.7 billion acquiring 60% of the stakes of Chinese local candy brand Hsu Fu Chi in December 2011， someone has forecast that a great change is going to happen to the candy industry in China.
Recently， another ground-shaking deal in the candy industry seemed to tell people that the changes are really approaching.
Hershey， a candy and chocolate company in the U.S.， announced that its wholly-owned subsidiary company， Hershey （Netherlands） Co.， Ltd， reached an agreement with Golden Monkey， an established Shanghai-based private candy enterprise in China. Hershey acquired 80% of Golden Monkey’s stakes. The deal is expected to be finished in the second quarter of this year.
Hershey kept increasing its investment into China in the past several years and is the fastest growing candy and chocolate company in China. After this acquisition， Hershey will capitalize on the brand advantages and multiple products of Golden Monkey to increase its brand awareness and product categories. In addition， the production capacity and the marketing forces of Golden Monkey are what attract Hershey too.
Hershey claimed that the acquisition of Golden Monkey will boost its development in China and help them provide better products and services for Chinese consumers. In addition， they could create more jobs in China through this acquisition.
As for Golden Monkey， the deal helps the company to connect to the mammoth size of Hershey and its excellent management skills， which can keep the sustainability and long-time development of its brands.
In May 2013， Hershey announced the establishment of its new R&D center in Pudong District， Shanghai. This was an act to accelerate the company’s growth rate and to consolidate its global strategies and competitiveness. With that R&D Center， Hershey will have been able to develop the new products catering to Chinese and even Asians very quickly. The first product from this R&D center – Lancaster Milk Candy– has been put onto the shelf in some cities of China and the nationwide distribution is to be started this year.
Shanghai-based Golden Monkey has a series of products， including the“Golden Monkey”-branded candies， chocolate， bean products and snacks. Its products are not only sold in cities， but also available in the rural markets， which is what Hershey needs. According to its financial report， 75% of its net profits came from chocolate and candy business while the rest came from the fast growing business of bean products and snack foods， a unit that Hershey never touched before. Moreover， Golden Monkey set up five manufacturing bases in the world， as well as 130 sales offices， employing 1，700 sales representatives and over 2，000 dealers. The nationwide manufacturing and distribution network enabled the smooth development of Golden Monkey. In the past few years， the sales of Golden Monkey could increase at a double-digit growth rate. Its total revenue in 2013 is expected to surpass US$225 million.
John P. Bilbrey， CEO and president of Hershey， believes that the acquisition of Golden Monkey， is a good act for Hershey in China. “China is now the fastest growing market for Hershey， as well as the engine for our global development. So， the wellness of Chinese market is very important for Hershey，”he said.
“That’s why we choose to set up a R&D center in China， which is our big- gest R&D Center except the one in our headquarters， Hershey Town， Penn.，”Bilbrey added. “The cooperation with Golden Monkey is a win-win result for us. The strong products and distribution of this company， in addition its strength in the traditional trade， provide us an opportunity to integrate the resources. Our cooperation will make our brands grow stronger together. In addition， Golden Monkey’s focus on bean products and snacks tally with our ideas with consumers as the core of the market.”
Zhao Qisan， founder and board chairman of Golden Monkey， said： “Our products have grown up to a trustworthy and nation-known brand in less than 25 years. Hershey has the similar culture and strategy with us in the brand development and sales power. It is an honor for us to have our potential and power acknowledged by the famous multinational like Hershey. I believe that the cooperation will bring the advantages of Hershey.”
Humberto P. Alfonso， president of Hershey International， said that the business of Golden Monkey is what Hershey wants. At first， Golden Monkey is in China， one of the most important international markets for Hershey. Secondly， it is a company of candies and snacks. Thirdly， it owns the distribution channels that Hershey never explored. In addition， Golden Monkey owns the history of innovation and high-quality products.
This deal seems to create a win-win situation， but it also made experts worry about the foreign companies are growing too strong in the Chinese candy market. Li Guangdou， a famous brand expert in China， said that the Chinese candy market was very large and owned unlimited potential. That’s why foreign companies would like to spend a lot of money acquiring Chinese candy enterprises.
Recently， another ground-shaking deal in the candy industry seemed to tell people that the changes are really approaching.
Hershey， a candy and chocolate company in the U.S.， announced that its wholly-owned subsidiary company， Hershey （Netherlands） Co.， Ltd， reached an agreement with Golden Monkey， an established Shanghai-based private candy enterprise in China. Hershey acquired 80% of Golden Monkey’s stakes. The deal is expected to be finished in the second quarter of this year.
Hershey kept increasing its investment into China in the past several years and is the fastest growing candy and chocolate company in China. After this acquisition， Hershey will capitalize on the brand advantages and multiple products of Golden Monkey to increase its brand awareness and product categories. In addition， the production capacity and the marketing forces of Golden Monkey are what attract Hershey too.
Hershey claimed that the acquisition of Golden Monkey will boost its development in China and help them provide better products and services for Chinese consumers. In addition， they could create more jobs in China through this acquisition.
As for Golden Monkey， the deal helps the company to connect to the mammoth size of Hershey and its excellent management skills， which can keep the sustainability and long-time development of its brands.
In May 2013， Hershey announced the establishment of its new R&D center in Pudong District， Shanghai. This was an act to accelerate the company’s growth rate and to consolidate its global strategies and competitiveness. With that R&D Center， Hershey will have been able to develop the new products catering to Chinese and even Asians very quickly. The first product from this R&D center – Lancaster Milk Candy– has been put onto the shelf in some cities of China and the nationwide distribution is to be started this year.
Shanghai-based Golden Monkey has a series of products， including the“Golden Monkey”-branded candies， chocolate， bean products and snacks. Its products are not only sold in cities， but also available in the rural markets， which is what Hershey needs. According to its financial report， 75% of its net profits came from chocolate and candy business while the rest came from the fast growing business of bean products and snack foods， a unit that Hershey never touched before. Moreover， Golden Monkey set up five manufacturing bases in the world， as well as 130 sales offices， employing 1，700 sales representatives and over 2，000 dealers. The nationwide manufacturing and distribution network enabled the smooth development of Golden Monkey. In the past few years， the sales of Golden Monkey could increase at a double-digit growth rate. Its total revenue in 2013 is expected to surpass US$225 million.
John P. Bilbrey， CEO and president of Hershey， believes that the acquisition of Golden Monkey， is a good act for Hershey in China. “China is now the fastest growing market for Hershey， as well as the engine for our global development. So， the wellness of Chinese market is very important for Hershey，”he said.
“That’s why we choose to set up a R&D center in China， which is our big- gest R&D Center except the one in our headquarters， Hershey Town， Penn.，”Bilbrey added. “The cooperation with Golden Monkey is a win-win result for us. The strong products and distribution of this company， in addition its strength in the traditional trade， provide us an opportunity to integrate the resources. Our cooperation will make our brands grow stronger together. In addition， Golden Monkey’s focus on bean products and snacks tally with our ideas with consumers as the core of the market.”
Zhao Qisan， founder and board chairman of Golden Monkey， said： “Our products have grown up to a trustworthy and nation-known brand in less than 25 years. Hershey has the similar culture and strategy with us in the brand development and sales power. It is an honor for us to have our potential and power acknowledged by the famous multinational like Hershey. I believe that the cooperation will bring the advantages of Hershey.”
Humberto P. Alfonso， president of Hershey International， said that the business of Golden Monkey is what Hershey wants. At first， Golden Monkey is in China， one of the most important international markets for Hershey. Secondly， it is a company of candies and snacks. Thirdly， it owns the distribution channels that Hershey never explored. In addition， Golden Monkey owns the history of innovation and high-quality products.
This deal seems to create a win-win situation， but it also made experts worry about the foreign companies are growing too strong in the Chinese candy market. Li Guangdou， a famous brand expert in China， said that the Chinese candy market was very large and owned unlimited potential. That’s why foreign companies would like to spend a lot of money acquiring Chinese candy enterprises.