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Cadbury acquires US energy bar maker Clif for $2.9 billion.

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Cadbury, the owner of the iconic British chocolate brand Cadbury, has announced the acquisition of Clif Bar & Company, a US energy bar maker, for $2.9 billion (£2.4 billion).

Mondelez International, which also owns Oreo, Toblerone, and Milka, says the acquisition will help them “lead the future of snacking.”

The food and beverage conglomerate also stated that it will continue to manufacture Clif’s products at its facilities in Idaho and Indiana.

Mondelez issued a warning in March about the impact of rising production costs.

The American confectionary company said in a statement on Monday that the buyout will increase the value of its snack bar business to more than $1 billion.

It also stated that once the transaction is completed later this year, it will continue to operate Clif’s business from its headquarters in Emeryville, California.

“We are thrilled to welcome Clif Bar & Company’s iconic brands and passionate employees to the Mondelez International family,” said Mondelez chairman and CEO Dirk Van de Put.

“As we continue to scale our high-growth snack bar business, this transaction advances our ambition to lead the future of snacking by winning in chocolate, biscuits, and baked snacks,” he added.

According to the company’s website, Clif was founded three decades ago by Gary Erickson, who came up with the idea for an energy bar during a 175-mile bike ride.

Clifford Erickson, Mr Erickson’s father and “childhood hero,” was named after the bar, which opened “after countless hours in mom’s kitchen.”

Sally Grimes, CEO of Clif Bar, stated that Mondelez was “the right partner at the right time to support Clif in our next chapter of growth.”

Mondelez, which also owns Daim, Ritz, and Belvita, reported net revenue of nearly $29 billion last year.

However, like many of its competitors, it is facing rising costs and announced in March that it would reduce the size of Cadbury Dairy Milk sharing bars by 10%.

It reduced the size of the bars from 200g to 180g while not lowering the price for customers.

“We look to absorb costs wherever we can,” a Mondelez spokesperson said. “However, in this difficult environment, we’ve had to make the decision to slightly reduce the weight of our medium Cadbury Dairy Milk bars for the first time since 2012.”

Nestle, the Swiss food giant, warned in April that it will continue to raise product prices due to rising ingredient costs.

The KitKat and Nesquik maker said its prices had risen by more than 5% in the first three months of the year.

Nestle CEO Mark Schneider stated that as costs rise, “further pricing and mitigating actions over the course of the year” will be required.

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