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. Last Updated: 07/27/2016

U.S. Food Giant Kraft Snaps Up Pokrov Plant

America's largest branded food and beverage company, Kraft Foods, said Wednesday it had reached an agreement to purchase the Russian, Polish and Hungarian businesses of German confectioner Stollwerck AG for an undisclosed sum.

"This acquisition will allow us to strongly participate in the Russian confectionery market for the first time. Stollwerck has a leading position in confectionery in this country," the company said in a press release. "This is part of our strategy to rapidly expand our food portfolio in high-growth developing markets."

The deal, which still needs regulatory approval from the companies' respective countries, gives Kraft Stollwerck's Alpen Gold, Pokrov, Tibi and Americana brands and its factories in the Vladimir region town of Pokrov; Budapest, Hungary; and Poznan, Poland.

Kraft posted total revenues of $1.7 billion in the second quarter from sales of more than 60 brands, including Jacobs and Maxwell House coffees, Nabisco cookies and crackers, Philadelphia cream cheese, Oscar Mayer meats, Post cereals and Toblerone and Milka chocolates.

Stollwerck owns chocolate brands Alpen Gold and Pokrov and had a turnover of 1.4 billion Deutsche marks ($630 million) last year, $150 million of which was from sales in Russia, Hungary and Poland. The company will retain its production facilities in Germany and Switzerland.

Currently Kraft already has one factory in Russia, near St. Petersburg, where it has been packing its coffee since September.

The company has invested more than $15 million has been invested in the Leningrad region facility. Kraft also owned the Petrokonf confectionery plant, but sold it to Krasny Oktyabr in 1998.

The Pokrov factory is capable of producing 35,000 tons of chocolate products per year. Since 1997, $35 million has been invested in the plant.

Sergei Nosenko, the president of Babayevsky, a top Russian chocolate brand, said that until Kraft determines its plans for Russia, it would be hard to say how the acquisition of the factory would affect the market as a whole.