Orkla bids on health with Dansk Droge acquisition

Norway's Orkla has snapped up all shares in Danish supplement-maker Dansk Droge, as it positions to take advantage of consumer health trends.

Since 2002 Polaris private equity has held 72 per cent of shares in Dansk Droge, whose health brands include Litozin, Futura, Gerimax and Livol. Dansk Droge reported operating revenue of NOK 400m (c €51m) in 2005.

Around 17 per cent of this revenue was generated by sports nutrition companies SPP in Sweden and Finland, which are excluded from the transaction.

The value of the transaction has not been revealed.

Orkla, a supplier of branded consumer goods, has been in a strong position to make acquisitions, reporting a 75 per cent increase in operating profit in 2005 over 2004, to NOK4805m (€614m).

But although Orkla Brands' operating profit before amortisation rose ten per cent to NOK1049m (€134m), dietary supplements and health products achieved profit growth as one of the only two units to actually achieve profit growth. The operating profit increase was attributed to expansion.

The supplements business consists of Peter Möller and Collett Pharma, the latter acquired last year and considered to be "important element of efforts to establish a Nordic position in the dietary supplements and health product category." The two have now been merged under the name MöllerCollett and integration work is ongoing.

Polaris managing director Viggo nedergaard Jensen said: "In Orkla, Dansk Droge has a new owner with a strong position as a supplier of branded consumer goods to Nordic retailers."

Dansk Droge has also been busy expanding its export sales in recent years. Exports to more than 25 countries account for around 60 per cent of operating revenues.