US food giant HJ Heinz is to acquire its first major business in Brazil, the world’s fifth most populous nation.
Heinz has agreed to buy an 80 percent stake in Coniexpress SA Industrias Alimenticias, which produces the Quero brand of tomato-based sauces, tomato paste, ketchup, condiments and vegetables.
“This transaction is another significant step in our emerging markets strategy,” said William R. Johnson, chairman, president and CEO of Heinz. “The Quero brand is a natural fit with the global capabilities of Heinz and gives us a scalable growth platform in Brazil, a key emerging market with nearly 200 million consumers and a growing economy.”
Heinz expects emerging markets to account for over 20 percent of its total sales in the next fiscal year. The company acquired Chinese soy sauce manufacturer Foodstar last November, strengthening its position in Asia.
“With Quero, Heinz will be well positioned in the key emerging markets of Brazil, Russia, India, and China as well as Indonesia,” said Johnson. “We expect the Quero business to approximately double Heinz’s sales in Latin America in the first full year.
“Brazil has been on our priority list for some time,” he continued, “because it generates about 45 percent of Latin America’s gross domestic product and is one of the fastest growing economies in the world. It is a market with attractive economic growth, a large number of middle-class consumers and strong upside potential.”
The announcement coincided with Heinz third quarter results, in which the company reported a 20 percent rise in profits.
