18 November, 2009
Ferrero family steps out of shadows for Cadbury
* Secretive family, private company
* Never made an acquisition before
* Key employer in northwestern Italian town
By Giancarlo Navach
ALBA, Italy, Nov 18 (Reuters) - The Ferrero family's round Rocher chocolates are recognised worldwide but Italy's richest man, Michele Ferrero, and his two sons, have shunned publicity and kept their company very private -- up until now.
Ferrero, and its home base in this northwestern Italian town, is in the spotlight after it said it was considering a multi-billion euro bid for Cadbury (CBRY.L), the world's second-largest confectionery company. [ID:nN18112947]
In more than 60 years of history Ferrero has not made a single acquisition as it built up a confectionery empire it says ranks fourth in the world.
Michele Ferrero, 84, who took the reins in 1957, lives in Monte Carlo and has a villa in exclusive Cap Ferrat. Forbes magazine this month estimated his and his family's wealth at $9.5 billion, putting them at 40th place among the world's richest people.
Michele Ferrero's two sons, Pietro and Giovanni, are chief executives and run day-to-day operations.
Ferrero has kept to a philosophy of "better to speak through the products than show in public", according to a source close to the company. It has stuck to that policy with its workers as well.
"The company doesn't tell us anything, total reserve reigns. Up until a few years ago, there wasn't even a sign saying Ferrero on the Alba factory," said one employee in the factory car park.
The company sits at the heart of Alba, employing more than 4,000 people. Michele Ferrero still regularly visits the original factory there.
Ferrero remains a key presence for Alba, a town of some 30,000 residents in Piedmont, one of Italy's richest gastronomic regions.
COMPANY TOWN
"In every family of Alba, there has been or still is someone working for the group," Mayor Maurizio Marello said.
"This potential acquisition ... is a sign of the group's state of health ... it is obviously an advantage for us," he added.
Globally, Ferrero employs some 21,600 with 18 factories and operations in more than 36 countries.
Ferrero also makes Nutella hazelnut spread, Kinder chocolate eggs for children and Tic-Tac mints.
It prides itself on doing its own research -- not just into products but also packaging, which lengthens the shelf-life of products and protects against temperature changes. The protection helps make its goods regular items in small grocery stores worldwide.
The first Ferrero invention was Giandujot -- a paste or filling based on hazelnuts and created by Michele's father, Pietro, during World War Two when real chocolate was in short supply.
Ferrero runs its own distribution network and says that the idea for this came when a delivery waiting for a wholesaler was mobbed by a crowd in Milan and sold out before the store opened.
The in-house strategy now faces dramatic change, with speculation in newspapers that the shift in policy has caused a rift between Michele and his sons.
They want to seize the chance to gain ground in markets such as Britain and the Commonwealth countries.
A Ferrero spokesman would not comment on the reports. (additional reporting by Danilo Masoni in Monte Carlo)
(Writing by Jo Winterbottom; editing by Elaine Hardcastle)
Source: http://www.reuters.com
Ferrero family steps out of shadows for Cadbury Added: (18.11.2009)
Back to invest list
