Kerry Group sees Kraft Foods Inc's bid for Britain's Cadbury as the potential start of a wider consolidation wave with rich pickings for the Irish food group, its chief executive said on Saturday.
If the world's second largest food group succeeds with the $16.7 billion hostile bid for the maker of Dairy Milk launched earlier this month, it may have to dispose of assets which would fit well into Kerry's portfolio according to analysts.
I view it as maybe the beginning of a consolidation that needs to take place in the industry as we enter a new chapter after this economic turmoil, Kerry Group Chief Executive Stan McCarthy told Reuters.
Will it provide opportunities for Kerry? I think we are very well positioned to engage with these multinationals and ....there may be some disposals, McCarthy said on the sidelines of an economic forum in Dublin.
Analysts at NCB Stockbrokers said Kraft may opt to offload its food ingredient business which would be of interest for Kerry, which is one of the largest players in cheese ingredients and has significant operations in savory and sweet ingredients.
McCarthy said it was too early to talk about specific Kraft assets for Kerry, which makes Cheestrings snacks and Wall's sausages.
He remained upbeat about Kerry's trading prospects and reaffirmed its guidance for full-year earnings per share at the upper end of a 160-165 euro cent range.
We are coming through this turmoil, I am pretty pleased ... we are on plan, McCarthy said. We are pretty comfortable this year, our guidance remains.
McCarthy said an Irish press report that Kerry was looking for a stake worth almost 60 million euros in Eastern Condiments, one of India's largest curry powder firms was incorrect.
That (report) was not right, that's all I would say, but in terms of expansion in Asia, yes we are, that's very much on the plans and countries like India, Vietnam, Thailand we have to look for expansion there.
Business in Asia has been extremely healthy through these last 12 months.
(Editing by Carmel Crimmins)