Joint venture company Delfi-Orion will sell and market branded confectionery goods in Indonesia, Delfi announced last week.
The partners will have equal stakes and have agreed to jointly dedicate $3m capital to the venture.
Orion will manufacture its products for the market, while Delfi will be the exclusive local distributor.
First international JV for Orion
Korean firm Orion is best known for its Choco Pie. The joint venture company has named Choco Pie and a soft cupcake product as its main brands for the Indonesian market.
Orion vice-chairman Hur Innchul said: “This is Orion’s first-ever overseas joint venture partnership. We are very pleased to team up with the top confectionery company in Indonesia. It gives Orion a great opportunity to develop this fast-growing market.”
He added that Orion and Delfi would “not stop in Indonesia” and may explore other opportunities.
New categories for Delfi
Singapore-based Delfi Limited has focused on its branded consumer confectionery division since selling its ingredients arm to Barry Callebaut for $860m in December 2012.
Delfi CEO John Chuang said of the joint venture: “It will allow us to extend our portfolio into the soft biscuit and cake category that has been developed and perfected by Orion over the years.
He added: “Through this relationship, we believe there is always the potential of both partners working together in other areas.”
Indonesian chocolate: 5% CAGR
According to Euromonitor International, Delfi leads Indonesia’s chocolate confectionery through its Ceres business, which produces brands such as Silver Queen and Delfi tablets.
The market analysts forecast a 5% compound annual growth rate for chocolate confectionery in the country over the next five years, faster than the nation’s gum and sugar confectionery categories.
Delfi said the joint venture is subject to regulatory approval.