CHICAGO -- Candy maker Mars Inc. said vendors and retailers will benefit from a new Mars Wrigley Confectionery that combines Mars Chocolate and the gum company.
As reported in a McLane/CSP Daily News Flash, the new division, to be based in Chicago, was announced Thursday. The company also confirmed it bought out Berkshire Hathaway’s minority state in Wrigley and now fully owns the longtime Chicago gum company.
The new segment will be led by Wrigley president Martin Radvan. The company said the division, with 30,000 employees worldwide, is expected to be phased in next year.
Mars Chocolate and Wrigley will continue to operate separately for the time being. Jean-Christophe Flatin will continue as president of Mars Global Chocolate, and Casey Keller, previously regional president of Wrigley Americas, will become president of Global Wrigley.
Mars Wrigley Confectionery brings together the heritages of McLean, Va.-based Mars Chocolate and Chicago-based Wrigley, which the company said will help it better address consumer trends and accelerate growth. Among its brands are Snickers, M&M's, Dove and Twix chocolates; Doublemint and Extra gums; Altoids and Lifesavers mints; and Skittles.
The combination will make for simpler interactions with vendors and open opportunity for better collaboration on new products, the company said. “While they were running as two separate companies there was certainly collaboration, but there was a limit on coming together,” said corporate communications manager Kelly McGrail.
A Mars spokesman told TheStreet, a digital financial media company, that Berkshire owned a 19.3% equity interest in Wrigley and that the buyout was completed Sept. 27. Financial terms were not disclosed.
Mars and Berkshire teamed up in April 2008 to buy the Wm. Wrigley Jr. Co. for about $23 billion. After that deal closed in October 2008, Berkshire purchased a minority interest for $2.1 billion, which was subject to purchase by Mars over time.
Mars CEO Grant Reid said in a statement that the company was "grateful for the strong and productive partnership we have with Warren Buffett and Berkshire Hathaway" but also "equally pleased that sole ownership of Wrigley provides us with an opportunity to rethink how we simplify our Chocolate and Wrigley businesses so that we can bring a more holistic approach to this vibrant category."
The consolidation is in keeping with recent moves among big players in the snacks and candy industries.
Last year, Kraft and Heinz combined in a multibillion-dollar deal that was also funded by Berkshire. This summer, Hershey rejected a $23 billion takeover deal from Mondelez.
Mars Inc. has net sales of more than $33 billion and six business segments, including Chocolate (M&M's, Snickers, Dove, Galaxy, Mars, Milky Way and Twix); Wrigley (Doublemint, Extra, Orbit and 5 chewing gums; Skittles and Starburst candies; and Altoids and Lifesavers mints); Food (Uncle Ben's, Dolmio, Ebly, Masterfoods, Seeds of Change and Royco); Drinks (Alterra Coffee Roasters, The Bright Tea Co., Klix and Flavia); Symbioscience (Cocoavia and Wisdom Panel); and Petcare (Pedigree, Royal Canin, Whiskas, Kitekat, Banfield Pet Hospital, Cesar, Sheba, Dreamies and Nutro).
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