Mondelez International

(Redirected fromMondelēz International)

Mondelez International, Inc.(/ˌmɒndəˈlz/MON-də-LEEZ),[3]styled asMondelēz International,is an Americanmultinationalconfectionery,food,holding,beverageand snack food company based inChicago.[4]Mondelez has an annual revenue of about $26.5 billion and operates in approximately 160 countries.[5]It ranked No. 108 in the 2021Fortune 500list of the largest United States corporations by total revenue.[6]

Mondelēz International, Inc.
FormerlyKraft Foods Inc.
Company typePublic
ISINUS6092071058Edit this on Wikidata
Industry
FoundedDecember 10, 1923;100 years ago(1923-12-10)(as Kraft Foods Inc.)
Chicago,Illinois,U.S.
October 1, 2012;12 years ago(2012-10-01)(current form)[1]
Founders
  • Thomas H. McInnerney
  • Edward E. Rieck
HeadquartersChicago, Illinois,U.S.
Area served
Worldwide
Key people
Dirk Van de Put(chairmanandCEO)
ProductsConfectionery
Brands
List
RevenueIncreaseUS$36.02 billion(2023)
IncreaseUS$5.502 billion(2023)
IncreaseUS$4.968 billion(2023)
Total assetsIncreaseUS$71.39 billion(2023)
Total equityIncreaseUS$28.37 billion(2023)
Number of employees
91,000 (2023)
Subsidiaries
Websitemondelezinternational
Footnotes / references
[2]

The company has its origins asKraft Foods Inc.,which was founded in Chicago in 1923. The present enterprise was established in 2012 when Kraft Foods was renamed Mondelez and retained its snack food business, while its North American grocery business was spun off to a new company calledKraft Foods Group.The name is derived from theLatinwordmundus( "world" ) anddelez,a fanciful modification of the word "delicious."[7][8][9]

The Mondelez International company manufactures chocolate, cookies, biscuits, gum, confectionery, and powdered beverages. Mondelez International's portfolio includes several billion-dollar components, among them cookie, cracker, and candy brandsBelvita,Chips Ahoy!,Oreo,Ritz,TUC,Triscuit,Nabisco,LU,Sour Patch Kids,Barny,andPeek Freans;chocolate brandsMilka,Côte d'Or,Toblerone,Cadbury,Green & Black's,Freia,Marabou,andFry's;gum and cough drop brandsTrident,Dentyne,Chiclets,Halls,andStride;as well asTate's Bake Shopcookies and powdered beverage brandTang.[10]

Mondelez Canada holds the rights to Christie Brown and Company, which consists of brands such asMr. Christie,Triscuits,and Dad's Cookies. Its head office is inToronto,Ontario,with operations inBrampton,Hamilton,Ontario andMontreal,Quebec.

History

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Before Mondelez International

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Mondelez International is rooted in theNational Dairy Products Corporation(National Dairy), which was founded on December 10, 1923, by Thomas H. McInnerney and Edward E. Rieck. The firm was initially set up to execute on arollupstrategy in the fragmented United Statesice creamindustry.[11]

In 1924, Kraft Cheese Company was founded and was listed on theChicago Stock Exchange.[12]Two years later, it was listed on theNew York Stock Exchange.In 1928, it acquired Phenix Cheese Company, the maker of acream cheesebranded asPhiladelphia Cream Cheese,founded by Jason F. Whitney Sr. and the company changed its name to Kraft-Phenix Cheese Company.[citation needed]

In 1930, National Dairy acquired Kraft Phenix. After the acquisition, the combined company retained the National Dairy name and management, though the Kraft Phenix side of the company continued to operate largely independently.[12][13]

On September 7, 2009, Kraft made ahostile£10.2 billion takeover bid for the British confectionery groupCadbury,makers ofDairy MilkandBournvillechocolate.[14]On November 9, the company's bid (then £9.8 billion) was rejected by Cadbury, which called it a "derisory" offer.[15]Kraft upped its offer on December 4.[16]It had significant political and public opposition in the United Kingdom and abroad, leading to a call for the government to implement economicprotectionismin large-company takeovers.[17]On January 19, 2010, Cadbury approved a revised offer from Kraft which valued the company at £11.5 billion ($19.5 billion). Some funds for the takeover were provided by theRoyal Bank of Scotland.[18]

Cadbury sales were flat after Kraft's acquisition.[19]Despite the Cadbury takeover helping to boost overall sales by 30 percent, Kraft's net profit for the fourth quarter fell 24 percent (to $540 million) due to costs associated with integrating the UK business after the acquisition.[20]Kraft spent $1.3 billion on integration to achieve an estimated $675 million in annual savings by the end of 2012.[21]Kraft increased prices to offset rising commodity costs for corn, sugar, and cocoa in North America and Europe. According to Rosenfeld, "We expect it will remain weak for the foreseeable future." Taking into account integration costs, the acquisition reduced Kraft's earnings per share by about 33% immediately after the Cadbury purchase.[20]

Creation of Mondelēz International

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In August 2011, Kraft Foods announced plans to split into two publicly traded companies, an international snack-food company and a North American grocery company.[22][23]

The snack-food company, called Mondelez International, would be the legal successor of the old Kraft Foods, while the grocery company would be a new company,Kraft Foods Group.The split was completed in October 2012.[24]It was structured so that Kraft Foods changed its name to Mondelez International and spun off Kraft Foods Group as a new publicly traded company.[25]Kraft Foods Group later merged withHeinzto becomeKraft Heinz.[24]

In 2014, the company announced a merger of its coffee business with the Dutch firmDouwe Egberts.[26]The name of the newly merged company would beJacobs Douwe Egberts.[26]The merger was confirmed on May 6, 2014, and completed on July 2, 2015.[27][28]

In April 2015, the U.S. Commodity Futures Trading Commission (CFTC) alleged that Mondelez International and its former subsidiary, Mondelez Global, bought $90 million (£61 million) of wheat futures with no intention of taking delivery.[29]According to the CFTC, the purchase raised the price of the commodity and earned the company $5.4 million.[29]

On June 30, 2016, Mondelez made a $23 billion offer to buy its smaller rival,Hershey.[30]The half-cash, half-stock deal valued Hershey stock at $107 a share.[30]Hershey's board, however, unanimously rejected the offer.[30]In 2016,Terry'swas one of a number of brands acquired byEurazeofrom Mondelēz, and it subsequently became part of Carambar & Co.[31][32]

In August 2017, it was announced thatDirk Van de Put,Belgian CEO ofMcCain Foods,would succeedIrene Rosenfeldas CEO in November 2017.[33]

On May 6, 2018, Mondelez agreed to buy cookie makerTate's Bake Shopfor approximately $500 million.[34]The acquisition was completed on June 7, 2018.[35]

On June 19, 2019, Mondelez agreed to acquire a majority interest in Perfect Snacks, owner of refrigerated protein bar Perfect Bar.[36]The acquisition was completed on July 16.[37]

On February 25, 2020, Mondelez announced that it was acquiring a majority stake in Toronto-based Give & Go, a maker of two-bite brownies.[38]The acquisition was completed on April 3, 2020.[39]

In January 2021, Mondelez announced that it had bought Hu Master Holdings for more than $250 million.[40]

On May 26, 2021, Mondelez announced an agreement to acquire Greek snack companyChipita S.A.,a high-growth key player in the Central and Eastern European croissants and baked snacks category.[41]On January 3, 2022, Mondelez announced that the acquisition was complete.[42]

In May 2022, it was announced Mondelez had acquiredGrupo Bimbo's confectionery business, Ricolino, for approximately US$1.3 billion.[43]

On May 10, 2022, Mondelez announced that it would sell its gum business, includingTridentandDentyne,in developed markets including North America and parts of Europe, as well as the entireHallscough drop business.[44]

In June 2022, Mondelez announced that it would be acquiringClif Barfor $2.9 billion. Through the acquisition, Mondelez will obtain Clif, Luna, and Clif Bar Kids as a part of its portfolio.[45]

On December 19, 2022, Mondelez announced that it was selling its gum business, including theTrident,Dentyne,ChicletsandStridebrands, toPerfetti Van Melle,the makers ofMentos.The deal closed on October 2, 2023.[46]

Corporate affairs

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The headquarters is located inFulton Market,in Chicago, Illinois.[47]In 2020, the company announced that the headquarters was moving from suburbanDeerfield, Illinoisto Chicago.[48]Mondelez' North American headquarters was then established inEast Hanover,New Jersey,U.S., and a globalinnovationcenter was opened in 2023 in nearbyWhippany,also inMorris County, New Jersey.[49]

Finances

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For the fiscal year 2017, Mondelēz International reported earnings of US$2.922 billion, with an annual revenue of US$25.896 billion, a decline of 0.1% over the previous fiscal cycle.[50]Mondelēz International's shares traded at over $42 per share, and its market capitalization was valued at over US$58.8 billion in October 2018.[50]In the first quarter of 2020, due toCOVID-19 lockdownsand people stocking up with sweets, the company's sales grew by 15% in North America, increasing its overall revenue by almost 3%.[51]

Year[52] Revenue
in mil. US$
Net income
in mil. US$
Total assets
in mil. US$
Price per share
in US$
Employees
2005 34,113 2,632 57,628 14.42 94,000
2006 33,256 3,060 55,574 15.24 90,000
2007 35,858 2,721 67,993 16.33 103,000
2008 40,492 2,884 63,173 15.28 98,000
2009 38,754 3,021 66,714 13.68 97,000
2010 31,489 4,114 95,289 16.43 127,000
2011 35,810 3,554 93,837 19.21 126,000
2012 35,015 3,067 75,477 23.06 110,000
2013 35,299 3,915 72,515 28.09 107,000
2014 34,244 2,184 66,771 33.41 104,000
2015 29,636 7,267 62,843 38.64 99,000
2016 25,923 1,659 61,538 41.15 90,000
2017 25,896 2,922 63,109 42.46 83,000
2018 25,938 3,381 62,729 42.21 80,000
2019 25,868 3,870 64,549 51.57 80,000
2020 26,581 3,555 67,810 58.47 79,000
2021 28,720 4,300 67,092 66.31 79,000
2022 31,500 2,720 71,160 69.72 80,000

Brands

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Mondelez International brands (formerlyKraft Foods Inc.) includesbrand-nameproducts that are developed, owned, licensed, or distributed by Mondelez International. The company's core businesses aresnack foodsandconfectionery.In certain international territories, Kraft-branded products have been made by Mondelez under license fromKraft Heinz Companysince 2012.

Controversies

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Deforestation

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In September 2017, an investigation[53]conducted by NGOMighty Earthfound that a large amount of the cocoa used in chocolate produced by Mondelez and other major chocolate companies was grown illegally innational parksand other protected areas inIvory CoastandGhana.[54][55][56]The countries are the world's two largestcocoaproducers.[57][58]

The report documents how in several national parks and other protected areas, 90% or more of the land mass has been converted to cocoa.[59]Less than four percent of Ivory Coast remains densely forested, and the chocolate companies' laissez-faire approach to sourcing has driven extensivedeforestationin Ghana as well.[60]In Ivory Coast, deforestation has pushedchimpanzeesinto just a few small pockets, and reduced the country'selephantpopulation from several hundred thousand to about 200–400.[61][62][63]Mondelez claimed to have mapped almost all of its cocoa suppliers in Côte d'Ivoire, Ghana and Indonesia by 2018 in an effort to combat deforestation.[64]

In November 2018, an investigation byGreenpeace Internationalfound that 22palm oilsuppliers to Mondelez International cleared over 70,000 hectares (170,000 acres; 270 sq mi) of rainforest from 2015 to 2017.[65]Mondelez received a 'yellow', the second of the four possible ratings on the 2022 Chocolate Scorecard for Agroforestry i.e. 'starting to implement good policies'.[66]

Child slavery

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In 2021, Mondelez International was named in a class action lawsuit filed by eight former child slaves fromMali(aided by International Rights Advocates) who allege that the company aided and abetted their enslavement oncocoa plantations in Ivory Coast.The suit accused Mondelez (along withNestlé,Cargill,Mars,Olam International,The Hershey Company,andBarry Callebaut) of knowingly engaging in forced labor, and the plaintiffs sought damages for unjust enrichment, negligent supervision, and intentional infliction of emotional distress.[67]

As with deforestation, Mondelez is 'starting to implement good policies' according to the 2022 Chocolate Scorecard.[68]Its Cocoa Life programme for sustainable cocoa aims to address the root causes of child labour with a holistic approach, collaborating with families, encouraging school attendance and monitoring child labour on farms.[69]Cocoa Life farms accounted for 43% of Mondelez' cocoa needs by 2018 and the company planned to have 100% coverage with Cocoa Life by 2025.[70]

An investigation in 2022 by Britain's Channel 4Dispatchesfound children as young as 10 working on farms in Ghana supplying the Cadbury's brand of Mondelēz International.[71]The investigation went to an address on Mondelēz's Cocoa Life website in 2022 and discovered child laborers harvesting cocoa without protective clothing.

In November 2023, International Rights Advocates (on behalf of nine children) again filed a class-complaint against Cargill, Mars, and Mondelez, alleging that:[72][73]

rather than honor the pledge that they made [to phase out by 2005 their use of the Worst Forms of Child Labor as defined by ILO Convention No. 182.], defendants and all of the other major chocolate companies, have done little to address the ongoing and pervasive use of child workers performing the worst forms of child labor on their sourcing plantations and have focused on misleading the public by falsely claiming their "rehabilitation" programs offer meaningful assistance to children found working on their plantations.

Criticism of activities in Russia during the Russo-Ukrainian War

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After theRussian invasion of Ukraineon February 24, 2022, many international companies felt compelled to reduce or end business in the Russian Federation.[74]Mondelez made public statements that it had "reduced all non-core activities" and stopped new investments in the country.[75]As of March 12, 2022, Mondelez International was listed in an online spreadsheet byYaleprofessorJeffrey Sonnenfeldas being among a minority of companies continuing to do business in Russia, where it generates 3.5% of annual revenue (approximately $1 billion).[76]

On May 25, 2023, Ukraine'sNational Agency on Corruption Prevention(NACP) declared Mondelez International an international sponsor of war, noting that Mondelez's Russian branch increased its profit in 2022 by 303%.[77]This has led to boycotts from consumers and companies in the Nordic countries[78][79]as well as from the football associations of Denmark,[80]Norway[81]and Sweden.[82]Also, some Mondelez employees in Eastern Europe have protested.[83]

Anti-competitive practices

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In May 2024, theEuropean Commissionimposed a fine on Mondelez of €337.5 million foranti-competitive practicesand for abusing its dominant market position in breach ofantitrust lawsin theEuropean Union(EU), including illegally blocking cross-border sales of chocolate, cookies, and coffee products between EU countries, thereby preventing retailers from sourcing products from EU countries where prices were lower.[84][85]

See also

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References

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  • Media related toMondelēz Internationalat Wikimedia Commons
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  • Business data for Mondelez International:
  • New York Times article about Mondelez name and rebranding