Joyco, though conscious of the potential of rural markets, wanted to first evaluate their viability for the trade." We have to understand that the small quantities such townships can generate at this point may not keep the trade interested, so it doesn ' t make sense," said Hegde. Joyco management was then comfortable focusing on towns with 20,000 populations.
Over the last few years, Perfetti and Joyco had intensified their efforts to expand their franchise to young adults and above. While Perfetti had been hammering Alpenliebe ' s family candy positioning, it had brought in products like HappyDent to address an older audience. Joyco introduced Coffee Beans, Trex chewing gums and planned to push Aqtimint. With the government allowing artificial sweeteners, no-sugar presented a great opportunity for Joyco.
GLOBAL ACQUISITIONS
The global gum market was dominated by the chewing gum segment, which accounted for 85.7 % of the global sales in 2003. Europe remained the largest regional market, accounting for 37.6 % of the market. During 1999-2003 the global gum confectionery market had experienced strong growth owing to the growth in the US and European markets. The growing market for healthy forms of gum had led many other companies to invest in product innovation to satisfy these demands and also to increase their brand portfolio.
In July 2001, William Wrigley Jr. Co acquired the gum manufacturing assets of GumTech International Inc, a producer of chewing gum. The company also bought Velamints, a brand of breath mints, from Ragold. Wrigley ' s rival Cadbury was also strengthening its overall position in the confectionary industry. Earlier Cadbury had acquired Orangina and other soft drinks brands from France ' s Pernod Ricard, as well as high-profile names including Slush Puppie, Snapple, Dr Pepper and 7-Up, which had strengthened the overall position of the company.
Also, in 2001 Perfetti acquired 100 percent control of Van Melle for € 966 million. However the two companies had been co-operating in a number of countries since 1979. The newly enlarged company then adopted the name Perfetti Van Melle. The merger with Van Melle provided the new company with total sales of more than € 1 billion. The combined operations also gave the company a particularly strong position in many of the markets in the Asian region, such as China and India, where the company held number one or two positions in several categories.
Cadbury Schweppes in 2002 acquired 100 % of the branded chewing gum business of Dandy A / S, manufacturer of chewing gum, from the Bagger- Sorensen family in Denmark for GBP201 million. This made Cadbury Schweppes the second largest player in the European chewing gum market, with No. 1 positions in France, Denmark, Belgium and Switzerland. In March 2003, Cadbury acquired Adams chewing gum business for $ 4.2bn(£ 2.5bn, € 3.6bn), making it the largest confectionery business in the world. The acquisition consisted of the principal brands, including Halls, Trident, Dentyne / Dentyne Ice, the " Bubbas ", Clorets, Chiclets and Certs, together with other functional confectionery products, manufacturing facilities and international sales, distribution and support networks.
John Sunderland, CEO of Cadbury Schweppes, said, " Adams gives us confectionery market leadership and a unique portfolio with an offering in every confectionery category. It brings powerful brands, access to new geographies and significant scale in the fastest growing confectionery sectors. Cost and revenue synergies, and the opportunity to drive the business within a global confectionery group, will create significant value for our share owners.”
Through this acquisition Cadbury Schweppes had intended to broaden its position in the European confectionery market. This increased the intensity of competitive rivalry among US rivals such as Cadbury, Wrigley, PVM, Hershey Foods and Coca-Cola.
COMPETITORS
The global gum confectionery market reached a value of $ 8.05 billion in 2003, having grown at a compound annual growth rate( CAGR) of 3.8 % in the 1999-2003 periods.
The global gum confectionery market was currently dominated by Wrigley, Cadbury Schweppes, and Lotte. Wrigley had a leading position in nearly all the world ' s major markets, with Japan being the only major world market it had yet to breach. Its success could be attributed to widespread distribution, effective advertising, localized management and reliable quality.
Sugarized gum was still the most popular sector in the Asia Pacific region. By marketing sugar-free and medicated gum for health benefits, companies could allow consumers in the region to realize the qualities of these forms of gum, and thus boost their sales in the Asia Pacific region.
Cadbury Schweppes Plc.
Cadbury Schweppes at that time was the third largest soft drinks company and the fourth largest confectionery company in world. Cadbury Schweppes owned some of the world ' s best known confectionery brands such as Cadbury and Trebor Bassett. Although based in the UK, the company generated most of its sales in international markets. Cadbury went through a number of acquisitions in order to increase its market share and were also aggressively working to improve the performance of its
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