Oetker Group

Pizza Maker Ready for Another Bite, Anywhere

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Hungry folk all over the world eat the baking powder-to-beer conglomerate's pizza. Source: Getty

As boss of one of the world’s largest manufacturers of frozen pizza, Albert Christmann has a lot on his plate. He took over as chief executive of Germany’s Oetker Group this spring, just as the food-and-drinks conglomerate announced the sale of its container-shipping business that contributes half of group sales of €12 billion. Not only does Mr. Christmann now have to steer the Oetker into new waters, he has to keep on board the eight Oetker family members that control the company. They reportedly had a hard time agreeing on the sale of the shipping business – and on an outsider becoming chief executive. Comfort food, anyone?

No, Mr. Christmann insists, acquisitions might be the answer. The 53-year old told Handelsblatt that selling Hamburg Süd to Danish container giant Maersk for €3.7 billion was tough, but “strategically correct,” and laughed as he vowed: “I’m not going to let anyone undermine me – and I don’t have the feeling anyone will.” He pledged Oetker and its 400 subsidiaries would “continue to develop internationally” – organically and through acquisitions – and did not exclude Oetker eventually tapping the capital markets.

21 p14 Oetker’s Businesses-01

Conservatively run Oetker Group is typical for a slew of German family-owned companies that have become global players without courting media attention. Ever since the Bielefeld chemist-shop owner August Oetker invented a revolutionary baking powder in 1891, Oetker Group has grown to sell baking ingredients, beer, and more, in Europe and beyond. With various brands in Europe, Asia and North America, Oetker is a giant in the global frozen pizza market alongside food behemoths Nestle and General Mills.

While it was up to the family to decide how much of the proceeds flows to Oetker Group, the sale of Hamburg Süd means that Oetker “currently needs investment targets more than it needs fresh capital,” Mr. Christmann said. He declined to say where in the world and in which sectors he was now looking to invest. But he did point to acquisitions in the last two years in Mexico (desserts and baking products) and Australia (vanilla extract) to underline Oetker’s international experience – and its global ambitions.

Equity analyst Norbert Kollwida said it would “make sense” for Oetker to buy a company with a strong market position, certainly restructuring cases had not been on the group’s menu in the past. “The brand could be either national or international,” said the managing director of Frankfurt-based Kollwida Research, naming German frozen-meals maker Frosta as an example of potential targets. The listed company claims to be market leader in its segment in Germany. Could Mr. Christmann warm to a deal like that?

 

Christoph Kapalschinski covers the retail sector for Handelsblatt. Jeremy Gray contributed to this article. To contact the author: kapalschinski@handelsblatt.com 

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