Unilever plans to spend $140 million to build Russia’s largest ice cream factory and tap the country’s increasing appetite for cones and popsicles, Bloomberg reports Friday.
The plant is expected to produce its first ice cream at the start of 2011, Antoine de Saint-Affrique, executive vice president of Unilever’s Central and Eastern European businesses, told reporters today at the building site in Tula Region, south of Moscow. De Saint-Affrique said the facility will be Russia’s biggest factory for making the frozen food.
The plant will be Unilever’s eighth production facility in Russia, including one factory that belonged to Baltimore, the ketchup maker it acquired in April. Unilever, which sells ice cream under such brand names as Magnum and Ben & Jerry’s, along with rivals Nestle SA and Kraft Inc., have said they will increase spending and look for acquisitions in the country, where a decade of economic growth has spurred consumer spending.
“The potential for growth is enormous here,” said de Saint-Affrique. Russia is “a key strategy priority” for Unilever, which has been raising its market share and will continue to do so, he said.
Unilever, based in Rotterdam and London, last year bought Inmarko, the biggest ice cream maker in Russia, with a market share of at least 16 percent. Inmarko, the maker of Magnate and San Cremo ice cream, runs three factories in Novosibirsk, Omsk and Tula, according to its website.
“We are extremely active in this country,” de Saint-Affrique said. “We’ll always look at opportunities on the market. Provided there is a good strategy that fits with ours and a normal price,” Unilever will make an acquisition.
Russia’s consecutive years of growth may end this year, since capital markets have seized up and the global slowdown sapped demand for the country’s oil, natural gas and metals. The Russian economy shrank an annual 9.8 percent in the first quarter, and the World Bank said last month the economy will probably contract 7.9 percent in 2009.
