CHICAGO -- The world's dominant chewing gum maker is about to get sweeter.
Looking to extend more of its marketing might from gum to candy, Wm. Wrigley Jr. said yesterday that it has agreed to buy LifeSavers and Altoids from Kraft Foods in a $1.48 billion cash deal that refocuses Kraft's attention on its trademark supermarket products.
The agreement also includes the Creme Savers brand, and Trolli gummy candies, Sugus candies and other local and regional brands in the United States, Europe, Indonesia, and Thailand.
But Altoids and LifeSavers are by far the most sought-after prizes in the deal, which analysts expect to receive regulatory approval by mid-2005. Wrigley outbid Hershey Foods Corp., Mars Inc., Nestle SA and Cadbury Schweppes PLC for the Kraft sweets, which generate $490 million in annual sales.
''There are only a handful of confectionery brands around the world that have the combination of heritage and vitality that can match up with Wrigley brands," said Bill Wrigley Jr., the chairman, president, and chief executive of Chicago-based Wrigley. ''Altoids and LifeSavers are two such brands."
For Kraft, the sale offloads brands that produced just 1.6 percent of its $31 billion in revenue last year, along with $85 million in profits. According to analysts, the Northfield, Ill., food giant had about 4.7 percent of the US confectionery market, to 7.8 percent for Wrigley.
''By enabling us to better focus our resources, the sale should create value for Kraft, as well as our employees, customers and shareholders," chief executive Roger K. Deromedi said.
Kraft decided recently to shed most of its confection brands, admitting that candy was one of four categories being ''hammered" because of competitors' products and low-carb diets that forgo sweets and starchy foods.
After two years of sluggish results, the maker of Kraft cheese, Nabisco cookies, Maxwell House coffee and Oscar Mayer hot dogs also had pledged to shed businesses not part of its core strategy.
Shares of Kraft fell 20 cents to $34.68 on the New York Stock Exchange. Wrigley shares, which have risen 21 percent this year, gained 72 cents to $68.08.