Cerealia raises health profile

Related tags Nutrition Food Food industry Cerealia

Sweden's Cerealia Foods has increased its health offering with the
acquisition of five companies focused on vegetarian, organic and
healthy food products.

Sweden's Cerealia Foods has increased its health offering with the recent acquisition of five companies focused on vegetarian, ecological and healthy food products.

The businesses, all owned by Cerealia parent, the Swedish farmers co-operative Lantmännen Invest, produce total turnover of SK100 million (€11.3m).

"We already have a strong position among health-aware consumers with our brand AXA,"​ said Hakan Lundstedt, managing director for Cerealia Foods​, adding that the 'green' and vegetarian food market is experiencing strong growth.

"This investment in green food complements our current portfolio and gives us opportunities to create even stronger concepts within the vegetarian and ecological product area,"​ added Lundstedt.

The acquisitions include BioDoc, a firm developing cereal-based functional food products, and Kung Markatta, which has a wide product portfolio, including lactose- and gluten-free foods.

Cerealia has also bought Odalmannen, which refines and markets brown beans, peas, rice and barley grain, and Olands Fro, with similar activities, marketing its products through Odalmannen. Finally, SHG, a sales company that works for Odalmannen, Kung Markatta and BioDoc among others, will also join the group.

The operations will be gathered under a new unit within Cerealia Foods, led by Staffan Lindewald, previously responsible for the firm's operations in Finland.

The move reflects increasing innovation in the health sector from the saturated European bakery market. According to a recent Leatherhead Food report, the European bakery market is forecast to increase by a mere 0.2 per cent per annum in volume terms over the next five years. Ingredient suppliers are expanding their healthier ranges, to create new products with less fat and added vitamins, minerals and fibres.

Cerealia currently supplies several layers of the food industry, including bakeries and other food industries to wholesalers, catering centres, service trade and retailers. Its core activities remain in the bread category, boosted by the acquisition of bread group Schulstad in February this year. This made the group the biggest bakery supplier in the Nordic region.

However the foods business is being increasingly targeted for growth, with a focus on consumer brands, such as Kungsörnen, AXA and Start, being rolled out to new markets. Indeed exports account for 60 per cent of all group sales.

For the first eight months of the year, Cerealia reported weaker net profit (SK104 million) over the previous year's comparable period (106m), affected by reorganisation of the bakery sector. Sales also dropped to SK 5,692 million (from SK5,893m).

The acquisition became effective on 1 September.

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