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Tamara Minick-Scokalo resurfaces as Kraft’s European confectionery chief

February 4, 2010

I’m reliably informed that the “senior role” at Kraft being taken up by former Cadbury European chief  Tamara Minick-Scokalo is head of European confectionery.

She will therefore be the pivotal figure in integrating Kraft’s existing product range – principally Toblerone and Milka – with the newly acquired brands at Cadbury.

Readers of this blog may recall that she left Cadbury in slightly mysterious circumstances at the beginning of last July. An American with 20 years experience in Procter marketing, Minick-Scokalo moved to Europe a few years back (she is based in Geneva) and took on the top marketing/general management roles at US wine maker E&J Gallo, then Elizabeth Arden. Two years as head of global commerce at Cadbury Schweppes followed. She afterwards became European president of the demerged Cadbury confectionery operation, in January 2009. As such, Minick-Scokalo sat on the Cadbury executive board, reported directly to chief executive Todd Stitzer, and had control over Cadbury’s confectionery operations in both East and West Europe: that is, over 10,000 employees, €1bn annual sales and numerous factories.

But Stitzer, up to this point her champion, let her go after only six months in what appears to have been a selective senior management cull designed to cut costs.

How fortuitous then, that Kraft should launch a takeover bid for Cadbury in September and, having sown up the deal a few days ago, hire Minick-Scokalo to mastermind the brands’ integration from March 1. Whatever else may be wrong with the corporate “merger” (Warren Buffett is the expert on that matter, not me) integration of the two confectionery operations in Europe looks like an obvious fit. Cadbury, outside the chocolate-gobbling UK, is a patchwork quilt in need of further rationalisation; Kraft, on the other hand, already has strong Euro brands in Milka, Toblerone and Terry’s.

I do hope the senior managers who stay on at Cadbury (the top three having already quit) were nice to Minick-Scokalo before she left. Ignasi Ricou, who succeeded Minick-Scokalo as Cadbury president of Europe, and Phil Rumbol, UK marketing director, will no doubt be polishing their CVs just in case.

I imagine she will also have a hugely enhanced fan club in the marketing services world. Ogilvy, for example, handles the Toblerone brand and JWT does Kraft corporate advertising. Fallon need not lose all hope, however. Minick-Scokalo championed the ‘Gorilla’ advertising campaign.

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Cadbury fights for its life

September 7, 2009

CadburyOne of our national treasures looks set to disappear. No, no,no. I am not talking about Sir Tel being replaced at Radio 2 by Chris Evans, but of Cadbury, which faces a £10.2bn hostile bid from Kraft Foods.

The chances of Cadbury retaining its independence after this unwanted intervention do not look good. Of course, it may not be Kraft that emerges the eventual winner. According to City analysts, the Kraft bid – though superficially attractive at a 31% premium to the pre-bid share price – is pitched far too low. What they have in mind is the same multiple that Mars paid for Wrigley last year, which would mean about £10 a share – a long way up from the 745p on the table. Also, only £4.1bn is in cash, so the bid is far from knock-out.

But maybe we’re getting too technical here. Cadbury is definitely in play and Kraft is, at first sight, better positioned to haul the booty away than Nestlé or Hershey. In fact, it cannot afford not to win; neither can its competitors stand idly by and let it. Here is a landscape-changing deal in the offing, which would propel Kraft to the world’s largest confectionery company in an industry where scale is increasingly important (as the Mars deal showed).

Nestlé and Hershey would have considerable problems with the competition authorities (even if they divided the spoils between them), but there are few apparent conflicts of interest affecting a Kraft/Cadbury combo. Kraft, which owns Milka, Terry’s and Toblerone, is strong in confectionery in Europe and Latin America, where Cadbury is weak. Cadbury, on the other hand, offers Kraft a high-growth gum business and exposure in a number of invaluable emerging markets.

Kraft has suggested it will keep the Somerdale factory going, which Cadbury itself is threatening to close. That’s politically astute, but it won’t alter the fact that any alternative Cadbury owner will have to make some medium-term decisions likely to squeeze the culture out of the acquired company. Nestlé did no less when it acquired Rowntree, another Quaker company, over 20 years ago. There will be too many cost synergies involved, debts to be paid off and shareholders appeased, post-deal, for Cadbury culture to be maintained in aspic.

What of the brands? The Cadbury Dairy Milk kids may well twitch their last in one big wide-eyed rictus, which would be a great pity. But, if the Kraft deal does come off, I know someone likely to come out smiling. Kraft places a fair bit of its promotional spend with JWT, which also has a toe-hold in the Cadbury gum business.

And lastly, what of Nestlé? If Kraft triumphs in the takeover battle, that will leave Nestlé’s carefully laid plans for becoming the dominant global confectionery player in tatters. There’s more on this in my column this week.


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