The Swiss chocolate maker Lindt & Sprüngli Group is buying an American icon, the American family business Russell Stover Candies.
Russell Stover Candies was already a household name in 1994 when it became a pop culture phenomenon thanks to the Oscar-winning film "Forrest Gump." The title character, sitting on a park bench with a box of Russell Stover chocolates by his side, talked about his philosophy of life. "My mama always said: 'Life is like a box of chocolates -- you never know what you are gonna get," Gump said.
The purchase of Russell Stover, founded in 1923 in Denver, will make Lindt the third-largest North American chocolate maker, following Hershey's and Mars. The acquisition allows Lindt to expand in the world's biggest chocolate market, although it's adding a mid-range product that won't compete directly with its other U.S. brand, Ghirardelli, which is known for higher-priced chocolate bars and cocoa.
Still, the acquisition was seen as surprising by analysts from Vontobel, given that the boxed chocolate market isn't growing as quickly as other chocolate products, notes the FT. Russell Stover's products, which also include the Whitman brand of boxed chocolates, are picked up around holidays such as Valentine's day and Easter.
"'This biggest and most important strategic acquisition to date in Lindt & Sprüngli's history is a unique opportunity for us to expand our North American chocolate business and will greatly enhance the group's status in the world's biggest overall chocolate marketplace," said Lindt chairman Ernst Tanner in a statement.
The Swiss chocolate maker paid about $1.4 billion for Russell Stover, according to the FT, although the purchase price wasn't disclosed by the company.
Russell Stover employs 2,700 people and has annual sales of about $500 million, the statement said. It has four chocolate factories, with two in Kansas and another two in Texas and Colorado. Lindt said it will keep Russell Stover's headquarters in Kansas City and maintain a "clear commitment to continuity and local manufacturing."
The acquisition will help strengthen Lindt's position in the Midwest, given that Ghirardelli tends to be popular on the West Coast, while Lindt-brand products are established on the East Coast, a Lindt spokeswoman told CBS MoneyWatch. Russell Stover is an "American brand beloved by Americans," which appealed to the Swiss company, she added.