Mondelez International's deal for Ricolino is seen as a strategic play on growth
ismagilov/iStock via Getty Images

Mondelez International (NASDAQ:MDLZ) gained 1.08% in Monday trading after the company targeted the whitespace opportunity in Mexican confectionery category through the $1.3B acquisition of Ricolino.
The food company will pick up key brands Ricolino, Vero, La Corona and Coronado in the deal, which are leaders in lollipops, marshmallows, chocolate, gummies and other categories. Bank of America thinks the new brands will complement MDLZâs existing snacking portfolio.
The acquisition is seen underscoring MDLZ's desire to enhance topline growth through expanding its portfolio into higher growth snacking segments in new geographies. Morgan Stanley said Ricolino is well-positioned in the fast growing Mexican chocolate category. "We expect MDLZ to leverage Ricolino's broad distribution footprint as it has over 2,100 DSD routes, which serves 440,000 traditional trade stores, and see opportunity for revenue synergies," noted analyst Pamela Kaufman.
The Ricolino deal is seen positioning MDLZ to deliver on ~3.5 to 4% organic topline growth over the mid-term given its attractive growth profile. Morgan Stanley also forecast a 0.5% to 1.0% EPS accretion opportunity for MDLZ in 2024 from the deal.
Dig into more details on the Ricolino deal.