Raisio's operations in 2007-2014 fall into three strategic phases. In 2010, following the phases of turnaround and improved profitability, Raisio moved to the growth phase that is still continuing. The acquisition of Benecol business from the affiliates of Johnson & Johnson completed in 2014 was a good and important deal for Raisio. It gives us the opportunity to develop Benecol on our own terms.
Raisio's strategic phases
The year 2014: Growth phase continued
On 19 November 2014, Raisio acquired the Benecol business from the affiliates of Johnson & Johnson in the UK, Ireland and Belgium and amended the agreement on the Northern American markets of Benecol. The acquisition is estimated to increase Raisio's EBIT by some 9 million euros annually. The integration of the acquired business as part of Raisio was completed according to plan. Benecol product deliveries continued without interruptions and sales were at good levels.
Stock Exchangre Release 11 November 2014: Raisio acquired Benecol business from affiliates of Johnson & Johnson
Raisio's EBIT 2007-2014
The acquisitions and divestments Raisio has completed during its growth phase have significantly improved the company's EBIT.
The years 2010-2013: Growth
Raisio's key target is profitable growth organically and through acquisitions. Although Raisio has faced different challenges during the three strategic phases, all phases have had common success factors: the ability to detect opportunities, to use them efficiently and to adapt promptly to significantly and rapidly changing business environment.
Raisio has shown its ability to make successful acquisitions. The acquisitions completed met the criteria Raisio has set on its acquisitions. During the period 2010-2013, Raisio has carried out four acquisitions; two largest in the UK, one in Poland and one in the Czech Republic.
Raisio was again a net debt free company despite the acquisitions of EUR 200 million completed on a debt free basis during the growth phase. This gave Raisio a good opportunity to continue the implementation of the growth phase in line with its strategy.
Acquisitions and divestments 2010-2013
Raisio sold fixed assets of its non-dairy business as well as Nordic Milkfreedom and Soygurt brands to Norwegian Kavli. The contract was signed on 5 March 2013. Operations were transferred to the new owner on 9 May 2013.
Raisio sold and transferred its US-based esterification plant to American Avoca Inc. The agreement was signed on 18 April 2013. Raisio's Summerville plant operated as a reserve plant with low volumes. In 2012, net sales of the factory totalled approximately EUR 3.2 million excluding the plant stanol ester production.
On 13 November 2012, Raisio acquired a Czech confectionery company, Candy Plus. The purchase price was EUR 20.5 million on a debt-free basis including a new capital investment of EUR 2.3 million in fruit-liquorice capability. Raisio paid the consideration from its cash reserves. The acquisition complements Raisio's existing, successful confectionery activities in the UK.
On 20 March 2012, Raisio acquired Polish Sulma sp. z o.o.'s pasta and grits operations, its intellectual property rights as well as fixed and current assets. The value of the deal was EUR 2.4 million (PLN 9.8 million).
On 1 July 2011, Raisio divested its malt business to Viking Malt and continued the contract farming of malting barley. The malt business divestment was part of streamlining of Raisio's activities since synergies between the company's other businesses were not significant. The transaction price was EUR 17 million and Raisio recorded a one-off gain of approximately EUR 5 million on the deal.
At the beginning of its growth phase, Raisio strengthened its foothold in the UK through the acquisition of Glisten in 2010 and Big Bear Group in 2011. The product range of each company included breakfast and snack products and confectionery. Raisio has reorganised and centralised its activities during the years.
The years 2008-2009: Profitability
During the profitability phase of 2008 and 2009, Raisio focused on the profitability improvement. Main measures to achieve this included the renewal of product range to better meet consumer needs and enhancement of business processes. In addition, Raisio launched new products in its home market and prepared to enter into new markets and product categories. Moreover, the company's Eastern European operations were rationalised to improve profitability.
In 2009, Raisio sold its margarine business to Bunge. With this divestment, Raisio strategically focused more clearly on grain-based products and gained additional resources for the development of the company's other businesses. At the end of the profitability phase, Raisio had become the most profitable listed food company in Finland.
The year 2007: Turnaround
During the turnaround phase of 2007, Raisio divested its unprofitable operations, such as potato and diagnostics businesses, and sold the company manufacturing special feeds as well as its share in the Polish dairy company. In addition, the organisation was streamlined and operations were enhanced.
When Raisio got back the rights related to the Benecol brand and plant stanol ester from its long-term partner McNeil, the company had an opportunity to focus on the development of its operations and product applications.