Premier Foods will make some of Cadbury’s best-loved cake treats until at least 2022 after today agreeing a deal with the chocolatier’s owners.
Shares in the food manufacturer led the way on the FTSE Small-Cap index, climbing almost three per cent in early trading.
Premier Foods already produces “Cadbury branded cake and ambient dessert products” for Mondelez. Today’s deal means Premier Foods will extend its licence for another five years, with a further option to extend until 2025 if certain criteria are met.
Over one million Cadbury Mini Rolls are baked every day at Premier Foods’ manufacturing facility in Moreton, on the Wirral.
And under the new agreement a wider range of Cadbury brands, including Flake and Crunchie, can be used by Premier Foods to make cakes.
The two firms have been working together for over 30 years with distribution in the UK and Australia being particularly successful in recent years. The latest accord will enable growth beyond core markets to 46 countries with South Africa, Canada, Japan, China and India targeted.
Premier Foods chief executive Gavin Darby said today’s news was “good news for British exports”, adding:
“I’m delighted we’re entering into a new long-term global partnership with Mondelez International which will unlock exciting new growth opportunities for both partners.
This will give us a great platform to invest in developing the Cadbury cake brand in the UK and around the world and represents a major boost to our fast growing International business.
Mondelez was formed as part of a corporate shake-up of Kraft Foods in 2012. The US food giant bought Cadbury in 2010 and Mondelez owns a number of other UK chocolate-makers including Terry’s and Fry’s.
Glenn Caton Mondelez International president of northern Europe said:
“We are very proud of our long term partnership with Premier Foods and look forward to continuing to work together to nurture and develop our well-loved portfolio of brands and products.