Seefeldquai 17
The Core Values Of Barry Callebaut are Consistent Quality: The uniformity of our production sites, together with the most up-to-date equipment and the know-how of our teams, guarantee a consistent quality throughout the world and thereby an unequalled security of supply. Just In Time Delivery: The geographical spread of our production units and the uniformity of production sites guarantee a just-in-time delivery in Europe, North America and Asia. This allows our customers to maintain a minimum stock, thereby reducing the risks of deterioration of the quality. Ability and Support in Research & Development: We are going to combine and substantially reinforce our worldwide know-how in the production sector while continuing to intensify the product development in order to allow our customers to better adapt to the changing needs of the consumers. Technical Assistance: Our experience in the cocoa and chocolate industry must be used for the benefits of our customers. Our teams will be at our customers' disposal in order to develop new products as well as assisting them with the start-up of new equipment so as to avoid any production difficulties.
Franco-Belgo-Swiss Barry Callebaut AG is the world's leading manufacturer of chocolate and cocoa products for industrial and consumer use. A publicly traded subsidiary of Klaus J. Jacobs Holdings (KJJ), which owns some 67 percent of the company, Barry Callebaut has its corporate headquarters in Zurich, Switzerland, while maintaining its French and Belgian roots. Barry Callebaut operates some 20 cocoa processing and chocolate production facilities worldwide, including four factories in the United States and Canada and ten facilities in Europe, including The Netherlands, the United Kingdom, and Italy, as well as France and Belgium. The company also has entered new markets in the 1990s, opening a factory in Lodz, Poland to serve the Eastern European market and a state-of-the-art facility in Singapore, from which the company hopes to gain access to the potentially huge chocolate markets in Asia--that is, if the company can succeed in converting Asian taste buds to its products.
Barry Callebaut also is well represented in the Ivory Coast--the world's largest single producer of cocoa beans. The company operates four cocoa processing and refining plants, as well as holding a share of that country's cocoa crop. In all, Barry Callebaut transforms between 11 and 15 percent of the total worldwide cocoa crop. Along with its Ivory Coast plants, Barry Callebaut operates two cocoa bean processing factories in Cameroon. Barry Callebaut also operates, in addition to its production facilities, six Chocolate Schools--in Saint Hyacinthe, Quebec, Canada; Pennsauken, Pennsylvania; Meulan, France; Wieze, Belgium; Nervi, Italy; and in Singapore.
Product of a merger between Callebaut and Cacao Barry in 1996, Barry Callebaut provides a more or less complete range of couverture chocolates and other industrial use chocolates to the confectionery, ice cream, baked goods, dairy, and gourmet chocolate markets. Industrial cocoa and chocolates account for the majority of Barry Callebaut's revenues--in 1998 the industrial market represented 94 percent of the company's total sales of SFr 2.16 billion. Barry Callebaut also produces confectionery products for the consumer market; these sales represent the remaining six percent of the company's total sales.
Barry Callebaut went public in June 1998, listing on the Zurich Stock Exchange. The company remains controlled at nearly 67 percent by Swiss magnate Klaus J. Jacobs, architect of the consumer chocolate giant Jacobs Suchard, which was acquired by Philip Morris in the early 1990s. Jacobs, a former Olympic horseman and one of the wealthiest people in Switzerland, also holds 24 percent of Adecco, a European leader in the recruitment and temporary employment service market, as well the financial services company Allgemeine Finanzgesellschaft, in Germany.
300 Years of Chocolate History
The combined Barry and Callebaut operation represented some 300 years of chocolate history when Callebaut bought rival Barry in 1996. Led by Klaus J. Jacobs, the renamed Barry Callebaut became the world's single largest producer of industrial use chocolate and cocoa products, processing as much as 15 percent of the world's supply of raw cocoa.
Both companies traced their origins to the 19th century, yet both companies entered their respective core markets--cocoa and chocolate production--in the early decades of the 20th century. Cacao Barry was founded in 1842 by Charles Barry in Meulan, France. The Barry family entered cocoa production in 1920, building a facility in Meulan that would remain one of Cacao Barry's most important production facilities through the end of the century.
Belgium's Callebaut family entered the trade in 1850, operating a brewery, malt, and dairy company, before turning to chocolate production in 1911. The Callebaut family's original chocolate products were chocolate bars; chocolate couverture, or covering, products--extending the company's production of industrial use chocolate--were introduced in 1925. By then the Barry family company had been taken over by another family, the LaCarre family. The LaCarres would keep the Cacao Barry name, however.
Barry and Callebaut would operate, in large part, complementary product lines throughout the century, with the former processing raw cocoa for use by chocolate producers such as the latter. Nevertheless, Barry would gain a reputation for its own fine quality chocolate products--and especially its industrial use chocolates. Meanwhile, Callebaut's small family-run operation would benefit from the increasing worldwide interest in Belgian chocolates, considered by many to be the finest chocolates in the world. Callebaut began exporting its products in 1950, building up the Callebaut name in the European and North American markets.
During this time Barry began imposing itself as one of the world's premier cocoa products producers. Seeking to extend its activity to complete control of the cocoa production process, Barry initiated partnerships with the principal cocoa-producing countries. This course would lead the company to implant itself on the African continent. In 1952 Barry opened production facilities in Cameroon and in the chief cocoa bean producing nation of the Ivory Coast.
Barry's expanding grip on cocoa processing and cocoa products manufacturing would lead the company to withdraw from the consumer products segment in the mid-1960s in favor of continuing to boost its share of the industrial use cocoa market. At the same time, Barry sought to expand its presence in the chief cocoa consuming markets, principally the European and North American markets. This expansion would lead the company to build or acquire factories in England, Canada, and in the United States, where the company acquired US Cocoa, one of the United States' leading cocoa powder producers.
Mergers and Acquisitions: 1970s-90s
Barry's expansion continued in the 1970s, including the acquisition of Italy's Sicao. Callebaut also was extending its presence in Italy, building a plant and opening one of its Chocolate Schools there. Meanwhile, Barry's control of the cocoa market increased with the acquisition of Cacao Processing United in Louviers, France; under Barry's leadership, the Louviers plant specialized in cocoa bean processing, grinding, and pressing, for the production of the principal cocoa products: cocoa powder, cocoa liquor, and cocoa butter. In 1974, Barry would take over one of its chief domestic competitors, with the acquisition of Belgium's Goemaere.
The 1980s, however, would see changes in ownership for both Barry and Callebaut. The Callebaut family business was taken over by Interfood, a subsidiary of Tobler-Suchard, maker of chocolate and cocoa consumer products. The Callebaut family did not withdraw from chocolate-making entirely: in 1982 Bernard Callebaut moved to Canada, where he founded Chocolaterie Bernard Callebaut. In 1983 Interfood was in turn bought up by Klaus J. Jacobs, then in the process of building a consumer chocolate empire. The resulting Jacobs Suchard became one of the world's leading chocolate manufacturers.
Barry, too, had lost its independence. In 1982 the company was taken over by fellow French concern Sacré et Denrées. Nevertheless, Barry, like Callebaut, continued operations under its own name. A crucial step in Barry's expansion was taken in 1985, when the company acquired Bensdorp, of Bussum in The Netherlands. The Bensdorp name was already known worldwide. Founded in 1840 by Gerard Bernadus Bensdorp, this company built its success on two processes that became important for the overall cocoa trade. These processes were the alkalization--or "Dutching"--of cocoa, and the separation of cocoa butter from the cocoa mass. The main Bussum facility was established in 1884, and it remained in operation through the 20th century. Under Barry's ownership, Bensdorp continued to produce its own branded cocoa products.
Jacobs Suchard continued its own expansion drive, acquiring the United Kingdom's S&A Lesne in 1985. In 1987 Jacobs Suchard purchased the Brach candy company, based in Chicago, Illinois, a move intended to enable Jacobs Suchard, by then with annual sales topping US $3 billion, to move into the U.S. consumer candy market. This acquisition, however, proved somewhat disastrous and would lead Jacobs into a retreat from the consumer chocolate market. Soon after the Brach acquisition, Klaus J. Jacobs Holdings announced its agreement to sell off its consumer candy holdings to the Philip Morris Group for a purchase price worth nearly US $2 billion. These operations were combined with Philip Morris's Kraft foods subsidiary to form the Kraft-Jacobs-Suchard division.
Klaus Jacobs, however, would retain Jacobs Suchard's industrial chocolates divisions. Jacobs would also be left holding the Brach candy subsidiary, which later merged with Tennessee-based rival Brock's in the 1990s. With his chocolate holdings pared down, Jacobs once again consolidated around the Callebaut industrial use chocolates operation. Jacobs would retain 100 percent control of Callebaut, keeping the company private until after its late 1990s merger with Cacao Barry.
In 1987 Barry added a new cocoa processing plant in its Meulan, France base. Not long after, the company found itself under new ownership. In 1992 the Société Centrale d'Investissement (SCI) acquired control of Cacao Barry. Under SCI's ownership, Barry expanded in the United Kingdom, adding a chocolate production unit there. SCI's losses--which reached FFr 8.3 billion in 1994--would, however, lead the investment group to bring in a new partner in that year, selling 49 percent of Cacao Barry to the Compagnie Nationale à Portefeuille (CNP), an investment vehicle held by the Albert Frère group.
Two years later, Klaus Jacobs gained access to Barry by purchasing, through Callebaut, CNP's share of Barry, before acquiring complete control from SCI. The purchase price was reportedly near US $400 million. The merger--which was named Barry Callebaut, with headquarters at Jacobs' Zurich base--created the world's leading producer of industrial use cocoa and chocolate. The merger also brought Jacobs back into the ranks of the world's leading chocolate manufacturers.
The company's existing operations underwent a restructuring, reinforcing the two companies' mostly complementary operations, while combining the two companies' brand recognition. Barry Callebaut's brand lines now included the Bensdorp brand of cocoa powders; the Barry and Callebaut brands of gourmet chocolate and cocoa products; and the new Barry Callebaut brand of industrial use cocoa powder, butter, liquor, and chocolate.
The merger nearly fell through, however. The company's extensive international implantation required it to receive clearance from the antitrust review boards of the countries concerned. The company met the most resistance in Callebaut's Belgian home, where the merger was, in fact, rejected. Barry Callebaut won out, however, on a technicality (the review board handed down their decision too late), and the merger was allowed to be completed. As part of the merger, Barry Callebaut agreed to sell off part of its Goemaere cocoa production unit.
Barry Callebaut's antitrust difficulties forced it to postpone a planned public offering. This was finally achieved in June 1998, when Barry Callebaut placed a listing on the Zurich Stock Exchange. Klaus Jacobs remained in control of the company, with nearly 70 percent of its shares. The public offering gave Barry Callebaut further impetus for a newly revigorated expansion campaign.
Barry Callebaut sought to extend its dominance of the Western European and North American chocolate markets--the primary chocolate markets worldwide&mdashø those of other parts of the globe. On the Barry side, the company already had entered the Eastern European market in 1995, with the construction of Cacao Barry Polska, a chocolate production facility. Callebaut, meanwhile, had been looking to expand in the booming Asian market--where chocolate was beginning to find some popularity--by opening sales offices in Singapore and Hong Kong. In 1997 the company began construction on a state-of-the-art chocolate production facility in Singapore, with plans to extend distribution from there to such markets as Vietnam, China, Hong Kong, the Philippines, and Japan, as well as covering the New Zealand and Australian markets.
Barry Callebaut also moved to consolidate its main markets. In 1998 the company acquired Van Leer Chocolate, based in the United States. This acquisition was followed by the acquisition of Carma-Pfister AG, a Swiss-based chocolate company, in January 1999. These moves were followed soon after by the acquisition of Chadler Industrial de Bahia. Based in Brazil, the February 1999 purchase was aimed at enabling Barry Callebaut to enter the South American market. With a presence on nearly all the continents, and with ownership of nearly 15 percent of the world's cocoa supply, Barry Callebaut was certain to continue leading the world's cocoa and chocolate industries.
Principal Divisions: Barry Callebaut France; Barry Callebaut Belgium; Barry Callebaut United Kingdom; Barry Callebaut The Netherlands; Barry Callebaut Italy; Barry Callebaut Poland; Barry Callebaut Canada; Barry Callebaut United States; Barry Callebaut Ivory Coast; Barry Callebaut Singapore; Barry Callebaut Cameroon.
Comment about this article, ask questions, or add new information about this topic: