>> Swiss food group Nestle has agreed to sell its US confectionery business for $2.8 billion, meaning American household candy brands like Butterfinger and Baby Ruth will be getting a new owner, Italian chocolatier, Ferrero. And as Reuters' Martinne Geller explains, the company best known for its gold-wrapped Ferrero Rocher and chocolate spread Nutella could be getting a sweet deal.
>> This gives them a bigger platform, bigger negotiating power with retailers. It increases manufacturing capacity. This is their third deal in North American in the last year. So they're really, really keen to expand there. This for a company who, for 70 years, didn't do any acquisitions, was very insular, and now they're expanding quite aggressively.
>> Ferrero beat US chocolate giant, Hershey, to the deal. Its reward is moving from being the fifth to the third biggest player in the US market. For fourth place Nestle, it's a chance to jettison an underperforming domestic unit, in order to focus on its faster growing global brands.
And the deal is also a sign of how the US candy market is changing.>> It is a step towards consolidation of the US market. And the US market has come under a lot of pressure in recent years from consumers shifting to healthier snacks like fruit and nut bars, greek yogurt, more protein based snacks, and more savory snacks.
>> A much tougher market therefore, but with its new scale, Ferrero could be in a stronger position to compete.