Argentina’s iconic dairy firm Sancor is struggling financially, but a company with an even higher profile might be close to snapping it up — Coca-Cola is considering a bid for at least part of its assets.
According to company spokesmen, Coca-Cola wants to purchase Sancor’s yogurts and desserts lines.
“We confirm that there is interest on our part to compete with other companies for the purchase of Sancor’s yogurts, desserts and crème caramel products in the country,” company sources told Clarín yesterday.
The soft drinks giant is not alone in eyeing Sancor’s assets, however, as national seed oil manufacturer Vicentín has also made a bid around the US$100-million mark to the dairy firm’s owners.
Vicentín made an offer for Sancor’s brands in the same sector than Coca-Cola, in a bid that would also bag the firm 500 of Sancor’s employees and a series of its production plants.
If Coca-Cola’s bid is succesful, it would be the firm’s second big acquisition locally after it agreed to buy Unilever’s AdeS soy-based beverage unit for about US$575 million in a bid to bolster its portfolio of non-fizzy drinks.
Sancor is undergoing serious financial difficulties, with contract buyouts and uncertainty clouding its future.
According to Sunchales mayor Gonzalo Toselli, the top authority in the town where Sancor’s headquarters are located, the situation is “critical” despite a programme to “reduce debts and optimize spending.” The firm says it is not broke, but admits it is facing financial trouble.
A board meeting next Wednesday could be key to decide the future of the dairy products’ cooperative, as 1.5 billion pesos in outstanding debt and several buyout offers will be discussed.
Sancor employs 4,700 workers and has 15 manufacturing plants in the country’s agricultural heartland, across the Santa Fe, Córdoba and Buenos Aires provinces, although its effect on regional jobs is considered to be much bigger.
According to some rankings, Sancor is the second-biggest dairy firm in the country, behind Mastellone’s La Serenísima.
Source: Buenos Aires Herald
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