Orkla reorganises production after 3 acquisitions

Orkla Foods Romania, the domestic arm of Norway’s Orkla Foods with annual turnover worth 7 billion euros, decided to reorganise its production activity after having completed, in just two years, three major acquisitions for which it paid more than 25 million euros, according to market estimates.
“We want to standardise production in all the centres we own, and reorganising the activity will boost productivity,” stated Aliz Kosza, the company’s CEO. Aliz Kosza was recruited by the Norwegian group after having worked with MOL oil group and with Kraft Foods before that.
Orkla is one of the most dynamic multinationals operating in the food industry. The Norwegian group purchased Topway Food (production of margarine, sauces, ketchup and mustard) in 2002, Ardealul pate producer in 2005, a deal put at 5-6 million euros, and paid over 18 million euros for Royal Brinkers margarine producer in December 2005. In the wake of the 3 acquisitions, Orkla came to hold 5 production platforms and over 750 employees. Following the acquisition of Royal Brinkers companies (production and distribution), OFR’s cumulated turnover could reach 40-45 million euros per year, according to some estimates based on the financial results reported by the acquired companies.
OFR’s representatives did not provide any information on the turnover expected to be reached this year on the domestic market. They only stated that there would be increases of 10-25% in all product categories. “We are reorganising the production activity for retail margarine, with the entire production being moved to Bucharest. Professional margarine will continue to be made in Craiova. The reorganisation of Craiova platform will increase productivity,” states Kosza.
Orkla decided to also relocate the sauce and tomato paste production from Craiova to Targoviste, where the company owns another production platform.
“This way, we’ve cleared up the production lines of Craiova, where we will focus on fewer products,” specified Kosza.
By yearend, OFR will also finalise the merger through absorption with the acquired companies. The CEO says the merger will bring the company considerable cost savings.
“We will become 2 fiscal entities, which will primarily simplify financial operations. The ideal thing would have been for us to become a single entity, yet Ardealul will remain a separate fiscal entity because of a SAPARD project it is running that does not allow it to merge with another company for the next five years,” specified Kosza.