Vegemite will become Australian owned once again

Vegemite, bought by the American company Mondelez International, will become Australian owned once again due to a $460 million Bega Cheese deal.

Vegemite is a salty, malty, black yeast extract to spread on bread, sandwiches, and toast. The British Medical Association said it is a rich source of B vitamins, and it contains no fat or sugar, or animal extracts. The extracts are onion and celery, with gluten.

Cyril Percy Callister of Melbourne, Australia, developed the spread in 1922 for the company Fred Walker & Co. It was marketed for sale in 1923. In 1925 Walker established the Kraft Walker Cheese Co, which became Kraft Foods Incorporated after a merger with the Kraft company of America in 1930. Kraft split in 2011 and and one part of the company changed its name to Mondelez International (with confectionary brands such as Toblerone, Cadbury, and Oreo biscuits). Vegemite continued to be produced in the Melbourne manufacturing facility in Australia, but was fully owned by the American company.

Now the Australian Bega Cheese company will buy back Vegemite and other Kraft brands following an agreement in January 2017 for $460 million. Bega Cheese will borrow the funds needed to complete the purchase. In a surprise move, Bega Cheese said it will buy the Kraft food businesses in Australia which gives it control of Vegemite, peanut butter, mayonnaise and Kraft processed cheese (but not Kraft's Philadelphia cheese business).

Bega Cheese’s link with Kraft began in 2009, when Bega began producing some of the American company's processed cheese products."Today is a historic day for Bega Cheese," the executive chairman, Mr Barry Irvin told analysts. "This is an exciting evolution for the company. We are buying an iconic brand in Vegemite and some growth opportunities into the future."

Irwin said all staff at the Port Melbourne site it is buying from Kraft will be retained, including administration staff, at least initially, as Bega intends to operate the new business "as a separate platform."

"At the heart and the core of the business we are a dairy company, unquestionably. We own the number one cheese brand in Australia, we're the biggest cream cheese producers in Australia, we're a big infant formula company, so dairy is at our heart … but with spreads, whether it's Vegemite or peanut butter and cheese, there's a lot of commonality in the consumer base that actually purchases and consumes those products, so we see it as a development of the business rather than a transformation of the business."

Data from Euromonitor shows that sales of yeast-based spreads in 2016 declined to $135.1 million from $137.4 million in 2015. However, bringing the focus back on Australian products made in Australia and owned by an Australian company will hopefully improve sales of Vegemite. The news has made Australians ''happy little Vegemites'' again.

We're happy little Vegemites

As bright as bright can be.

We all enjoy our Vegemite

For breakfast, lunch, and tea.

Our mummies say we're growing stronger

Every single week,

Because we love our Vegemite

We all adore our Vegemite

It puts a rose in every cheek.

http://www.canberratimes.com.au/business/bega-snaps-up-vegemite-as-part-of-460m-deal-20170118-gtu7wk.html

MARTINA NICOLLS is an international aid and development consultant, and the author of:- The Shortness of Life: A Mongolian Lament (2015), Liberia’s Deadest Ends (2012), Bardot’s Comet (2011), Kashmir on a Knife-Edge (2010) and The Sudan Curse (2009).