Cargill to acquire Wilmar's 50% owned unit Aalst Chocolate for undisclosed sum

AGRICULTURE giant Cargill has entered into an agreement to acquire Singapore-based chocolate manufacturer Aalst Chocolate for an undisclosed amount.

Aalst is 50 per cent owned by Singapore-listed Wilmar International. In 2017, Wilmar had purchased the stake for an undisclosed sum through its subsidiary KOG Investments. Wilmar said the acquisition would be a "strategic complement" to its own specialty fats and sugar businesses, as the two commodities are essential raw materials for chocolate. The remaining 50 per cent is owned by Aalst's co-founders Richard Lee and Connie Kwan. 

Upon completion of the transaction, all of Aalst's assets will join Cargill's cocoa and chocolate Asia-Pacific operations. These include Aalst's manufacturing plant in Tuas, its research and development capabilities in Singapore and Shanghai, as well as some 200 employees across the region.

Aalst's customer base spans more than 50 countries currently, including in key markets such as India, China, South-east Asia, Oceania, Korea and Japan. The company's portfolio features six distinct brands, with offerings that include bake-stable and artisan chocolates and compounds, as well as a range of premium retail chocolate products and luxury pralines.

Cargill said the acquisition will significantly expand its Asia-Pacific footprint, and add chocolate to its existing portfolio of cocoa products that are already being sold throughout the region.

Cargill added that Singapore will keep its place as the company's strategic regional business hub due to its "unparalleled supply chain infrastructure and extensive international trade agreements".

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"The rapidly growing Asian marketplace is increasingly wielding its influence around the globe, sparking inspiration and driving international trends," said Francesca Kleemans, managing director for Cargill Cocoa & Chocolate Asia-Pacific.

"Joining with Aalst strengthens our position in this critical region, enabling us to become the supplier-of-choice for industrial and food service customers. With an expanded selection of value-added and specialty chocolate products and deep technical expertise, together we can accelerate innovation, better helping customers create products that continue to surprise and delight."

Through this partnership, the two companies will leverage their collective strengths and gain access to a robust sourcing network.

Richard Lee, chief executive of Aalst, said: "Together with Cargill's global expertise and experience, we believe that this new venture will be well-positioned to harness the full potential of exciting synergetic growth possibilities and become an ideal integrated chocolate solution provider for our customers."

Following this acquisition, Cargill is looking to start its first Asian chocolate manufacturing operations in India next month, which will see the company produce chocolate and chocolate compounds for the domestic market.

In an interview with The Business Times (BT) in August last year, Wilmar said Aalst constitutes just a "very small component" of its operations and therefore has a "negligible contribution" to the group's financials. Wilmar was, however, expecting Aalst to grow rapidly with the ability to leverage Wilmar's manufacturing and distribution network in Asia.

Aalst was also one of the past winners of the Enterprise 50 awards that are jointly organised by BT and KPMG in Singapore, recognising the 50 most enterprising privately owned local companies in Singapore.